Canadian factory downturn deepens as new orders hit 15-month low
Reuters
Published Dec 01, 2023 09:33AM ET
Updated Dec 01, 2023 12:52PM ET
By Fergal Smith
TORONTO (Reuters) - Canada's manufacturing sector contracted for a seventh straight month in November as global industrial weakness weighed on output and new orders, and despite an increase in hiring, data showed on Friday.
The S&P Global Canada Manufacturing Purchasing Managers' Index (PMI) fell to a seasonally adjusted 47.7 in November from 48.6 in October.
A reading below 50 indicates contraction in the sector. The PMI has been below that threshold since May, which is the longest such stretch since February 2016.
"Once again, the Canadian manufacturing PMI revealed some of the broad-based challenges facing the economy heading towards the end of the year," Paul Smith, economics director at S&P Global Market Intelligence, said in a statement.
"Output and new orders remain mired in contraction territory, linked in part to a broader-based global industrial weakness which is limiting demand and sales. Destocking remains prevalent across the supply chain, and client budgets are stretched."
The output index fell to 46.1 from 46.9 in October and the measure of new orders was at 45.4, its lowest level since August 2022, down from 48.3.
The employment measure was a bright spot, moving into expansion territory for the first time since April, as it rose to 50.7 from 49.9 in October.
But inflation pressures picked up, with the input price index rising to 55.6 from 55.1 in October and the output price measure at 54.8, its highest level since February, up from 52.6.
"Although inflation rates remain well down on previous year's highs, both vendors and manufacturers alike remain willing to push cost increases downstream to clients," Smith said.
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Written By: Reuters
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