TORONTO, Feb. 3, 2014 /CNW/ - January data pointed to a setback for the manufacturing sector at the start of 2014, 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 Supply Chain Management Association (SCMA), the RBC PMI offers a comprehensive and early indicator of trends in the Canadian manufacturing sector.
Output and new business growth were both the weakest for five months in January. Meanwhile, staffing levels were reduced for the first time in two years and manufacturers responded to the moderation in new order growth by cutting their input buying and pre-production inventory levels during the latest survey period.
Adjusted for seasonal influences, the headline RBC PMI dipped from 53.5 in December to 51.7 in January. Although the index remained above the neutral 50.0 value, the latest reading pointed to the slowest overall improvement in business conditions since April 2013. All five components of the RBC PMI made a weaker contribution to the headline index than in the previous month, led by slower expansions of output and new business volumes.
" Canada's manufacturing sector continued to grow in January, albeit at slower pace than December, registering at 51.7, down from 53.5," said Craig Wright, senior vice president and chief economist, RBC. "Underlying economic conditions - such as stronger growth in the U.S. economy and a weaker Canadian dollar - remain supportive for the outlook for domestic manufacturing in the period ahead."The headline RBC PMI reflects changes in output, new orders, employment, inventories, prices and supplier delivery times. Key findings from the January survey include:
- Slowest improvement in business conditions since April 2013
- Latest data indicates slower rates of output and new order growth
- Employment levels fall for first time in two years
- All four regions recorded higher production levels, led by Ontario .
- Quebec registered the slowest rise in new order volumes.
- Jobs growth was largely confined to Alberta & British Columbia.
- Robust rises in cost burdens were posted in all four regions in January.
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