Canadian economic activity in February fell by 0.1 per cent, Statistics Canada said Thursday.

The drop matched the expectations of economists.

Although it showed the economy was in contraction during the month, the February figure was not as bad as the 0.7 per cent tumble seen in January, a December drop of one per cent, and a retreat of 0.7 per cent in November.

"Following an incredibly intense three-month plunge in Canadian output from November to January, the mild February decline seems like a relief — a version of 'been down so long, it feels like up' to the economy," said BMO Capital Markets economist Douglas Porter.

"While by no means out of the woods just yet, the deepest declines for the economy increasingly look like they are behind us," Porter said.

Statistics Canada said economic activity has now declined by 2.4 per cent since October 2008.

Figures for the first quarter of 2009 are due to be released on June 1.

During February, a 19 per cent rise in motor vehicle and associated parts manufacturing was not enough to overcome declines in construction and mining activities. That helped propel the output of the overall manufacturing sector up by one per cent in the month, despite weakness in other manufacturing groups, including wood products, electric equipment, appliances and components, and plastics and rubber products manufacturing.

Activity in the wholesale and retail trade sectors was also off.

Oil and gas extraction and some tourism-related industries advanced.

Activity in the finance and insurance sector as well as the public sector were unchanged.