Weakest manufacturing growth in almost two years
- January 2, 2019
Canadian manufacturing growth moderated in December, according to the latest seasonally adjusted IHS Markit Canada Manufacturing Purchasing Managers’ Index.
Production volumes and incoming new work expanded at softer rates than in the prior month. The pace of manufacturing job creation also moderated in December, partly reflecting a drop in business optimism to its weakest point since February 2016.
The index reached 53.6 in December, down from 54.9 in November – the weakest improvement in business conditions since January 2017.
Survey respondents commented on less favourable demand conditions, particularly in the energy sector. There were also reports that global trade frictions had held back export sales during the latest survey period. New business volumes continued to rise in December, but at one of the slowest rates seen over the past two years. This partly reflected a stagnation in export sales.
Manufacturers continued to add to workforces in December, but the rate of job creation slowed from the survey-record peak seen in November. Anecdotal evidence suggested that less upbeat projections for output growth had acted as a brake on staff hiring at some firms.