Canadian manufacturers indicated further deterioration in overall business conditions during September, with output, new business and employment levels all falling since the previous month, according to the RBC PMI for September.
Weaker demand conditions resulted in lower input buying and greater efforts to streamline inventories, while backlogs of work were reduced at the fastest pace since April.
Moreover, the latest survey pointed to stagnating export sales, despite support from exchange rate depreciation against the U.S. dollar. At the same time, input prices increased at a robust pace amid widespread reports of rising costs for inputs purchased from abroad, but factory gate charges picked up only slightly over the month.
At 48.6 in September, down from 49.4 in August, the seasonally adjusted RBC Canadian Manufacturing PMI registered below the neutral 50.0 threshold for the second month running. Although the index only pointed to a moderate downturn in overall business conditions, the latest reading was the lowest recorded in the five-year survey history.