Canadian August Factory Sales Unexpectedly Fall on Food
Canadian factory sales fell in August as food and automobile production slowed following maintenance shutdowns.
Sales fell 0.2 percent to C$49.5 billion ($47.7 billion), Statistics Canada said today in Ottawa, while economists surveyed by Bloomberg forecast a 0.2 percent increase. Food sales fell 1.6 percent to C$7.06 billion and motor vehicles declined 2.5 percent to C$4.45 billion.
Manufacturing is one of the last major sectors of the economy that hasn’t returned to levels from before the 2008-2009 recession, hobbled by a strong currency and inconsistent U.S. demand. Bank of Canada Governor Stephen Poloz has said the economy lost some production capacity that won’t be recovered because of the depth of the global slump.
“It looks like a continuation of the overall flat trend in Canadian manufacturing remains in the cards,” Derek Holt, Scotiabank’s vice-president of economics in Toronto, wrote in a note to clients. He cited the 0.1 percent rise in new factory orders to C$49.8 billion as a sign of weak demand.
Canada’s dollar gained 0.2 percent to C$1.0366 per U.S. dollar at 9:40 a.m. in Toronto. One dollar buys 96.47 U.S. cents.
Sales fell in 11 of 21 categories tracked by Statistics Canada accounting for about 40 percent of production, including a 22.6 percent drop in the miscellaneous category to C$858 million.
Petroleum and coal product sales, the second-largest category by dollar value after transportation equipment, rose 1.0 percent to C$7.25 billion.
Excluding price changes, a better indicator of the industry’s contribution to economic growth, factory sales fell 0.3 percent.
Unfilled orders rose for the ninth time in 10 months, by 0.4 percent to C$73.9 billion. Aerospace and parts made up more than half of those orders at C$42 billion.
Inventories rose 0.3 percent to C$68.9 billion, with the ratio of factory stockpiles to sales unchanged at 1.39 in August.
From a year earlier, sales rose 0.3 percent.
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