Canadian business records strongest expansion
The February RBC Canadian Manufacturing Purchasing Managers' Index (RBC PMI) pointed to the strongest expansion in Canada's manufacturing sector since last September, although the rate of growth was only modest.
A monthly survey, conducted in association with Markit, a leading global financial information services company, and the Purchasing Management Association of Canada (PMAC), the RBC PMI offers a comprehensive and early indicator of trends in the Canadian manufacturing sector.
The headline RBC PMI - a composite indicator designed to provide a single-figure snapshot of the health of the manufacturing sector - indicated a modest improvement in Canadian manufacturing business conditions in February. However, at 51.7, the RBC PMI remained below the series average (53.6), despite having risen from the near survey-low of 50.5 in January.
The RBC PMI found that both output and new orders increased in February, partly reflecting greater demand and new client wins. The rates of growth were stronger than in January, but weaker than their respective series averages. Higher volumes of new work encouraged manufacturers to hire additional staff, with the rate of job creation at a fourmonth high. Meanwhile, the rate of input cost inflation slowed to a seven-month low and was modest in the context of historical data.
The headline RBC PMI reflects changes in output, new orders, employment, inventories, prices and supplier delivery times.
"Growth in the Canadian manufacturing sector gained momentum in February and, with panellists expressing an optimistic business outlook, this expansion may continue to strengthen in the coming months" said Cheryl Paradowski, president and chief executive officer, PMAC. "At the moment, however, growth remained below par, with both output and new orders increasing only modestly over the month."