The IHS Markit Canada Manufacturing Purchasing Managers’ Index (PMI) for May reached the highest level in over seven years.
The index reached 56.2, up from 55.5 in April, indicating the strongest overall improvement in business conditions since April 2011.
The manufacturing sector experienced a strong improvement in business conditions during May, underpinned by a faster rise in new business volumes. Export sales were a key driver of growth, with the latest increase in new work from abroad the steepest seen since March 2011.
Output, new orders and employment all recorded “robust” increases, and input cost inflation accelerated at the steepest rate since March 2014. Sustained rises in manufacturing workloads led to capacity pressures and another round of robust job creation. There were also widespread reports that supply chain constraints had led to delays in the receipt of raw materials. Meanwhile, worsening vendor performance and expected rises in input costs resulted in the sharpest pace of stock accumulation for six years in May.