Canada’s manufacturing sales rebound robustly in November
Source: FxWire Pro - Commentary / 19 Jan 2018 13:59:12 Eastern Standard Time
Canada’s manufacturing sales recovered robustly in November. After a pullback in October, manufacturing sales grew a solid 3.4 percent in November. In real terms, sales volume rose 2.5 percent in the month. Most of the gain was from the motor vehicle assembly and motor vehicle parts. In real terms motor-vehicle assembly volumes rose 14.7 percent in the month.
A recovery in chemical industry sales also added to the strength of November’s report. Sales rose 5.9 percent after a 2.7 percent decline in October. Region wise, sales rose in all provinces except Manitoba. Ontario saw a 5.8 percent rise because of the auto industry. In Western provinces growth was positive but slowed after a strong performance in the month prior.
The inventory-to-sales ratio dropped to 1.36 as the strong sales growth outpaced a more modest inventory build-up. The forward-looking components of the report were slightly weak, with both unfilled and new orders falling on the month. The declines were mainly due to the aerospace industry.
The strength in manufacturing sales and the recovery in the auto sector is encouraging after the setback in October. Economic growth is expected to have come in comparatively close to the central bank’s projection of 2.5 percent in the fourth quarter with some upside possible, stated TD Economics in a research report.
At 18:00 GMT the FxWirePro's Hourly Strength Index of Canadian Dollar was highly bearish -151.785, while the FxWirePro's Hourly Strength Index of US Dollar was neutral at 33.5321. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex
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