Canadian manufacturing sales rose more than expected in June, boosted by a 16% surge in oil and coal shipments.

Statistics Canada said Thursday manufacturing sales were up 1.1% to $58.1 billion in June, following a 1.5% increase in May.

Economists had expected an increase of 0.9% in June, according to Thomson Reuters Eikon.

In constant dollars, manufacturing sales were up 0.7% in June.

“Coupled with other better recent economic data—and absent an unexpected shock—the economic backdrop still looks strong enough to warrant further gradual interest rate hikes from the Bank of Canada,” Royal Bank senior economist Nathan Janzen wrote in a brief note to clients.

Read: Western provinces lead gain in May wholesale sales

Last week, Statistics Canada reported the economy generated 54,100 net new jobs in July and saw its unemployment rate fall back to its four-decade low of 5.8%. And earlier this month, data showed surging exports led by higher-priced energy products allowed Canada to shrug off new U.S. steel and aluminum tariffs in June to post the lowest monthly merchandise trade deficit with the world in 17 months.

Many economists expect Canada’s central bank to raise interest rates at least one more time this year.

The Bank of Canada raised its trend-setting interest rate by a quarter of a percentage point to 1.5% earlier this summer. Its key interest rate target is now at its highest point since December 2008.

The increase in factory sales came as the petroleum and coal products industry sales increased 15.9% in June.

Statistics Canada said several major refineries ramped up production levels following temporary shutdowns and spring maintenance that began in April and continued into May.

Capacity utilization rates for the industry rose from 69.8% in May to 89.8% in June.

The gains in the petroleum and coal group was offset in part by a drop in chemical products, which fell 4.5% in June as sales of pesticides, fertilizers and other agricultural chemical products dropped.

Sales of food products fell 1.7% in June following four consecutive monthly gains.

Omar Abdelrahman, economist at TD Economics, said in a research note Thursday that the surge in petroleum and coal would not be repeated. While the June sales numbers are “a solid handoff to the third quarter,” he noted “mixed signs” that could indicate decelerating momentum.

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