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The economy expanded at an annualized pace of 0.4% over the final three months of 2018 as the country posted its weakest quarterly growth since the middle of 2016, Statistics Canada said Friday.

The agency’s latest figures for real gross domestic product show that for all of last year the economy grew 1.8%, compared with the 3% expansion in 2017.

The fourth-quarter reading of 0.4% came in lower than Canada’s 2% growth in the previous quarter.

Economists had expected growth at an annualized pace of 1.2% for the final quarter of 2018, according to Thomson Reuters Eikon.

In a report, CIBC chief economist Avery Shenfeld said the central bank’s attempts to moderate growth with interest rate hikes has turned into a “near stall.” Referring to annualized growth of 1.8%, he said he’s not ringing the recession alarm bell yet because there’s no drop in employment, “but it’s an economy that would be vulnerable if any new shocks were to emerge.”

CIBC had previously forecast one more rate hike from the central bank in 2019, but now “the odds of seeing even that hike are tumbling,” he said. “Given that we haven’t yet seen a dent in employment, we’ll wait for the next jobs reading before reconsidering that call.”

Statistics Canada said the late-2018 slowdown was mostly due to a 2.7% contraction, on a quarter-over-quarter basis, in investment spending. Overall exports saw a slight decline and household spending slowed for a second straight quarter.

The declines, the report said, were largely offset by higher inventory accumulation.

The agency also released downward revisions for the first half of 2018 that dropped the second-quarter reading to 2.6% and the first-quarter number to 1.3%.

Canada’s terms of trade—a comparison of the prices of exports versus the prices of imports—saw its biggest drop since early 2009, the report said. It fell 3.6% in the fourth quarter, which was mostly due to a 34.3% decline in crude exports. In his report, Shenfeld noted that a trough in oil prices—now recovering—negatively affected terms of trade.

The agency said lower export prices led to a 1% decline in real gross national income, which represents the real purchasing power of income earned. It was the steepest drop since the first quarter of 2015.

On Friday, for the first time, the impacts of cannabis legalization were reflected in Statistics Canada’s real GDP report. Canada legalized recreational pot in October.

Household spending on marijuana, at an annual rate, totalled $5.9 billion in the fourth quarter—with illegal pot accounting for $4.7 billion of the total and legal weed representing $1.2 billion.

“Cannabis accounted for 0.5% of total household spending,” the report said of the quarterly numbers. “And non-medical cannabis accounted for 11.2% of spending on alcohol, tobacco and cannabis.”

The lower GDP figure for all of 2018 reflected a slowdown in most categories, including weaker results for household consumption, business investment and housing investment, which contracted 2.3%. The agency said the drop in housing investment coincided with rising interest rates and stricter mortgage rules came into force.

In December, economic growth contracted 0.1% for the second consecutive month and the third decline in four months.