Canada: Manufacturing PMI dips in January
In January, the IHS Markit Manufacturing Purchasing Managers’ Index (PMI) dipped to 56.2 from December’s 56.5. Consequently, the index remained above the neutral 50-threshold, but signaled a marginally weaker improvement in manufacturing operating conditions from the previous month.
Output growth eased in January, due to lingering Covid-19 restrictions, but remained upbeat nonetheless. Meanwhile, in the same month, new orders growth accelerated and headcounts increased relative to the previous month. On the other hand, unfavorable weather conditions, port congestions and truck shortages led to a rise in suppliers’ delivery times. On the price front, both input and output prices continued to rise in January, but at a slightly softer rate compared to December.
Commenting on the latest print reading, Shreeya Patel, an economist at IHS Markit, noted:
“Covid-19 yet again hit performance with output growth slowing notably. Tighter restrictions, among other issues, led to weak input availability and poor transportation conditions. Nevertheless, there is a further indication that restrictions will start to ease across the provinces in the months ahead. Fortunately, Canada boasts a high vaccination rate, which has allowed for growth to continue in the manufacturing sector despite a resurgence in cases.”