S&P Global: Canada’s manufacturing sector PMI hits highest since Feb 2023
Canada’s manufacturing economy experienced a positive boost in November, with output, new orders, and employment all showing growth from October, according to the latest data from the S&P Global Canada Manufacturing Purchasing Managers’ Index™ (PMI®) released on Monday. The PMI climbed to 52.0, up from 51.1 in October, marking the strongest growth since February 2023 and signaling an overall expansion in the sector.
This growth was underpinned by a significant increase in production, the best in over two-and-a-half years, and a surge in new orders, which saw its steepest rise in 21 months. The positive results were largely attributed to improved market activity and the impact of recent interest rate cuts. However, the growth was primarily driven by the domestic market, as new export orders continued their decline for the fifteenth consecutive month, pointing to subdued global demand.
Despite the upbeat performance, manufacturers reported challenges, particularly with supply chain disruptions. Delivery delays were linked to ongoing strikes at ports and railway delays, which contributed to lengthened supplier lead times. Inventory levels also increased for the second straight month, with warehouse stocks rising at the fastest pace since June.
On the price front, input price inflation accelerated, hitting its highest rate in over a year-and-a-half, partly due to a stronger US dollar raising the cost of imported goods and rising prices for livestock and lumber. As a result, manufacturers raised their output charges, although the increase remained below historical averages.
Looking ahead, manufacturers remain optimistic about the future, with firms predicting continued growth in the coming year. Confidence in the sector’s outlook for 2025 remains strong, despite the ongoing challenges in the global manufacturing landscape and supply chain pressures.
“Despite port disruptions leading to both inbound and outbound shipping delays in November, Canada’s manufacturing sector overall enjoyed a decent month,
with the sector expanding at its best rate since February 2023. Output and new orders both rose at stronger rates when compared to October, with firms noting an uplift in domestic market activity, linked in part to recent reductions in interest rates” Paul Smith, Economics Director at S&P Global Market Intelligence, said.
Attribution: S&P Global Survey
