Click image to enlarge

Consumer confidence augurs well for stronger North American economy

Consumer confidence in the US is growing, according to recent retails sales data.

The growing confidence bodes well for a strengthening US economy that will help spur growth in Canada too.

US retail sales in July 2012 increased a stronger than expected 0.8 per cent with market expectations centered on a 0.3 per cent gain, according to recent data and economic update by RBC.

 The decline in June was deepened to -0.7 per cent from a previously estimated -0.5 per cent although the drop in May was lessened slightly to -0.1 per cent from -0.2 per cent. Motor vehicle sales once again defied the trend suggested by the unit sales numbers rising 0.8 per cent in the month.

“The unit sales numbers would have implied a 1.0 per cent decline in the month although there were anecdotal reports that the drop in July (and increase in June) largely reflected fleet sales to businesses rather than retail sales to households. Greater than expected strength, however, was evident even eliminating the effect of motor vehicles with sales rising 0.8 per cent compared to expectations of a 0.3 per cent increase” says Paul Ferley, assistant chief economist with RBC Economics.

Part of the strength in ex-autos reflected sales at service stations managing to break a pattern of three consecutive months of declines by gaining 0.5 per cent. This was in part helped by gasoline prices stabilizing although we had expected some lagged effect from earlier price declines. The unexpected gain was not solely explained by the service station component because if eliminated both it and motor vehicles sales still managed to increase a robust 0.9 per cent.

The component of retail sales that goes into the GDP add up, the so called control retail sales that excludes the motor vehicles, gasoline stations, and building materials components, was up a strong 0.9% following a 0.2 per cent drop in June and a 0.1 per cent gain in May.

“The July retail sales report augurs well for a strengthening in third-quarter 2012 consumer spending growth to a little less than 2 per cent relative to the 1.5 per cent recorded in the second quarter of 2012. This is expected to contribute to overall GDP growth showing a similar pattern by increasing by 2 per cent relative to the 1.5 per cent recorded in the second quarter of 2012.

“Although the Fed should take some encouragement from this strengthening, there will remain frustration that it is still too weak to translate into any sustained downward pressure on the unemployment rate. This is expected to result in monetary conditions remaining highly accommodative with the current 0 per cent to 0.25 per cent range for fed funds being maintained into 2014. In fact, if subsequent data point to this sub-par growth performance persisting until the end of the year, then the central bank could opt for additional stimulus such as another round of asset purchases,” states Ferley.

RBC Economics

General Dynamics sets up remotely piloted aircraft CoE in Québec

Laflamme Aero's LX300 tandem rotor RPAS platform

General Dynamics Mission Systems–Canada has announced a new Centre of Excellence in Sherbrooke, Québec, for remotely piloted aircraft systems (RPAS) technologies.

OPG picks 5 Canadian firms to bid on $100M dam maintenance

Ontario Power Generation (OPG) has listed five Canadian companies able to bid on future repair, replacement and refurbishment work for large control gates at its hydroelectric generating stations.

Daimler dives deeper into AM

A pilot project for automated 3D printing of replacement parts and series-production components has been a huge success for Daimler, the automotive manufacturer says.

Ontario investment supports specialty steel producer to expand offerings

The Ontario government is supporting a $50-million investment by Canada’s only manufacturer of specialty steel products as the company seeks to be become the nation’s first to produce hi-nickel alloys and other specialty steels.

Bernard bolsters consumables line

Welding products supplier Bernard’s AccuLock S Series consumables include additional diffuser and nozzle types and sizes, as well as new contact tip options.

Canadian manufacturer supplies waterjet impellers to US Navy

A Canadian manufacturer has supplied the US Navy with 2 sets of four waterjet impellers. Dominis Engineering, Gloucester, ON, is one of only a few manufacturers in the world capable of machining these large, complex rotating components, says president Bodo Gospodnetic.

Union welcomes Chrysler $2 B investment in Windsor

Chrysler's announcement that it's investing $2 billion in its Windsor, ON, minivan plant was welcome news by workers in the automotive industry.

Grinding in Switzerland

Smarter grinding and advanced manufacturing technologies are the only way to secure future growth. That's the message Fritz Studer's management delivered during its 2016 Motion Meeting in Thun, Switzerland.

Free webinar links CAM software to multi-tasking

Topic: Mazak webinar "Process Planning for Improved Multi-Tasking Machining" 

Date & Time: February 18, 2:00 pm EST

Mazak is holding a free webinar on the role CAM software plays in process planning and optimizing of mill-turn operations. 

How to apply for CEWS and other funding for SMEs

Applications for the Canada Emergency Wage Subsidy (CEWS) will open on April 27, and the Canadian government has built an online calculator to help businesses estimate the amount of their wage subsidy.

FreePoint appoints new leadership team

Manufacturing software developer FreePoint Technologies has announced new leadership team appointments.

Aluminum industry shifting back to value-added as demand returns

Exports of standard commodity aluminium from Canada into the United States have decreased on a monthly basis, according to the Aluminium Association of Canada.

DMG MORI opens new tech centre in Canada

DMG MORI is celebrating its latest facility expansion with the grand opening of the DMG MORI Tech Centre in Mississauga, ON.

Welding association CWB Group rebrands under one name

Following on the heels of its 70th anniversary, The CWB Group is rebranding its different business units under one brand, CWB. The organization says the initiative will help industry more easily identify the CWB's complete offerings.

Stay In Touch

twitter facebook linkedIn