Canadian manufacturers experienced a slightly slower downturn in overall business conditions than the survey-record low seen during October. A slight rebound in new export sales and softer input price pressures were the main positive developments signalled by manufacturing companies in November.
New business levels, nonetheless, decreased at a sharper pace than in October, while efforts to reduce staffing numbers and inventories persisted during the latest survey period.
At 48.6 in November, the seasonally adjusted RBC Canadian Manufacturing PMI picked up from a survey-record low of 48.0 during October. That said, the latest reading remained inside contraction territory and lower than the average for 2015 so far (49.5). The main factor boosting the headline index in November was a much slower decline in production volumes than seen during the previous month. Moreover, the latest reduction in output was only marginal and the least marked since August.
“With another reading in contraction territory, the RBC PMI is signalling that Canada’s manufacturing sector continues to face headwinds from weak commodity prices, particularly for oil,” says Craig Wright, senior vice-president and chief economist, RBC.
He adds, “Ontario was a regional bright spot, however, with the fastest rise in export sales in nearly four years alongside sustained output growth and job creation. We remain confident that further strengthening in the U.S. economy will augment Canadian exports and set the stage for growing business conditions across the sector in the months ahead.”