Canadian manufacturing growth in October highest in 2.5 years
- November 2, 2013
The Canadian manufacturing continues to grow, hitting the highest level in 2.5 years in October, according to the RBC Canadian Manufacturing Purchasing Managers' Index (PMI). The PMI is a monthy survey that serves as a gauge of manufacturing business conditions.
After adjusting for seasonal variation, the RBC PMI - a composite indicator designed to provide a single-figure snapshot of the health of the manufacturing sector - rose to its highest level in 30 months during October. At 55.6, up from 54.2 in September and above the series average of 53.3, the RBC PMI indicated a strong improvement in Canadian manufacturing operation conditions.
The RBC PMI found that both output and new orders increased at the strongest rates since April 2011, which manufacturers generally attributed to greater client demand. Concurrently, firms continued to take on more staff, although the rate of job creation eased slightly from September's 15-month peak. Meanwhile, inflationary pressures strengthened, with the latest rise in input costs the greatest since March.
"Canada's manufacturing sector experienced a significant jump in October - up to 55.6 from 54.2 in September - a sign that global economic momentum is continuing to improve," says Craig Wright, senior vice-president and chief economist, RBC.
"Firmer global growth should boost external demand going forward; this pickup in demand for Canadian exports will no doubt augur well for Canadian manufacturers in the foreseeable future."