By Kim Mackrael
OTTAWA–Canadian manufacturing sales fell in August, marking a first retrenchment in the sector after three straight months of recovery from the pandemic-related shutdowns that took place in the spring.
Canadian factory sales declined 2% in August from the previous month to a seasonally adjusted 52.44 billion Canadian dollars (US$39.64 billion), Statistics Canada said Friday. Market expectations were for 1.4% decline, according to economists at CIBC Capital Markets.
The August data comes after three months of gains, as the economy bounced back with the easing of business restrictions in late spring and early summer. In the previous month, manufacturing sales advanced a revised 7.2%.
On a year-over-year basis, Canadian factory sales were down 8.8% in August. In volume, or price-adjusted, terms, sales fell 2.2% in August from the previous month.
The decline in August factory sales was led by a sharp drop in the transportation equipment industry, which was down 13.7%, following three months of strong gains. The August decline was mostly the result of lower sales of motor vehicle assembly and motor vehicle parts.
Overall, Canada’s factory-sales report showed new orders, a forward looking indicator, down 3.4%.
CIBC Capital Markets economist Andrew Grantham said the lack of momentum in Friday’s manufacturing report, and the recent rise in the number of reported Covid-19 cases, suggests the sector faces a prolonged recovery.
“With global and domestic demand likely slowing further since August as Covid-19 case numbers increased again, it’s hard to envision a meaningful acceleration for the manufacturing sector in the near-term,” Mr. Grantham said.
Write to Kim Mackrael at email@example.com
(END) Dow Jones Newswires