Modest improvement in manufacturing sector continued in July: RBC

RBC-PMI-ISM-manufacturing-sector-Canada-EDIWeekly

Canada’s manufacturing sector experienced positive business conditions in July, as measured by the RBC Canadian Manufacturing PMI. It was the second month in a row that the index was in positive territory after several months of falling, though it did in fact fall slightly from the six-month high reached in June. The index reflects changes in output, new orders, employment, inventories and supplier delivery times. It stood at 50.8 in July, down from 51.3 in June. A reading above 50 is considered positive. An increase in exports contributed to the recovery in manufacturing.

RBC economist Paul Ferley commented that the strengthening US economy and weaker Canadian dollar should provide a boost to exports and business conditions for manufacturers. However, the US manufacturing sector experienced a similar slowdown in July. The Institute for Supply Management (ISM) monthly index of factory activity fell from 53.5 to 52.7. The ISM also uses 50 as its threshold between growth and contraction.

July’s survey highlights another steady upturn in manufacturing production and new order volumes, which leaves the sector well placed to remain on a recovery footing through the third quarter of 2015. Exchange rate depreciation and stronger U.S. consumer spending continue to help shore up demand for Canadian manufactured goods, in turn offsetting some of the momentum lost from weaker energy sector spending patterns.

In Canada, despite modestly rising production, there was a drop in employment in the manufacturing sector. Backlogs of work also decreased for the eighth consecutive month. Ontario recorded the best performance in overall manufacturing conditions and job growth, while Alberta and British Columbia had the worst.

Nevertheless, the president and CEO of the Supply Chain Management Association characterized the July survey results as evidence of “another steady upturn in manufacturing and new order volumes.” The sector is “well placed” for a recovery through the third quarter of 2015, said Cheryl Paradowski.

Did you miss this?

Other Popular Stories

  • Elon Musk's Hyperloop vision racing ahead of naysayers and regulators — Boring Company receives permission to tunnel 10 miles; early tests of tube successful
  • Manufacturing slowdown reflects oil and dollar declines
  • World's biggest gold-copper mine wins government approval in BC
  • Volvo to Expand Production of XC40 SUV in Europe and China
  • Higher efficiency solar cells within reach
  • Canada's oil and gas industry gathering in Toronto for two-day forum
  • Industry mostly positive about government's infrastructure spending plans
  • Microgrids coming to two Ontario power utilities
  • Colossal Fusion Project Set to Transform the Energy Industry
  • Bankrupt hockey skate manufacturer bought by Canadian investors
  • Could the Future of Energy be Entirely Renewable?
  • Wood-based battery the next energy storage solution?
  • Toronto company seeking to market energy storage system
  • Aerospace industry trade war? $2 billion at stake as Canadian Foreign Affairs Minister reviews Boeing sole sourcing
  • Scientists use lab-grown crystals to create whiter LED light
  • Clean energy expected to surge as pv costs drop
  • Forestry sector providing job relief for former oil patch workers
  • SpaceX and ULA Score Major Air Force Contracts
  • Worker mobility key to construction's labour shortage
  • Supply of oil at record highs, at 100 million barrels a day for the “first time ever”; expected to grow
Scroll to Top