TORONTO, Nov. 1, 2012 /CNW/ - Canada's manufacturing sector grew only modestly in October, with the rate of expansion the weakest since January, according to the RBC Canadian Manufacturing Purchasing Managers' Index™ (RBC PMI™). A monthly survey, conducted in association with Markit, a leading global financial information services company, and the Purchasing Management Association of Canada (PMAC), the RBC PMI offers a comprehensive and early indicator of trends in the Canadian manufacturing sector.
The headline RBC PMI - a composite indicator designed to provide a single-figure snapshot of the health of the manufacturing sector - posted 51.4 in October, and was at a level indicative of only a modest expansion in Canada's manufacturing sector. Moreover, having fallen from 52.4 in September, the rate of growth signalled was the weakest for nine months.
The RBC PMI pointed to only modest increases in both output and new orders during October. In particular, the rate of total new order growth slowed over the month, posting the weakest expansion since January, despite a stronger rise in new export orders. Meanwhile, input prices continued to increase solidly, but the rate of inflation nonetheless remained weaker than the series average.
"Canadian manufacturing continued to weaken in October though the PMI measure is still indicative of growth in the sector which is in contrast to flat to declining activity in most other countries," said Craig Wright , senior vice-president and chief economist, RBC. "This weakening may in part be related to continuing uncertainty around how fiscal imbalances in the U.S. and the Euro area will be resolved. Greater strength in the Canadian manufacturing sector may hinge on some of this uncertainty easing as policy measures outside of Canada are implemented."In addition to the headline RBC PMI , the survey also tracks changes in output, new orders, employment, inventories, prices and supplier delivery times. Key findings from the October survey include:
- lowest PMI reading since January;
- slower rates of output and new order growth; and
- input price inflation remains weaker than series average.
- Three out of the four broad Canadian regions saw weaker manufacturing expansions in October, with Ontario the only exception.
- Incoming new work at manufacturers in Alberta and British Columbia fell marginally over the month.
- Manufacturing employment in Quebec was broadly unchanged from September, but staffing levels rose elsewhere.
- The rate of input price inflation slowed in all four regions during October.
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