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Canada PMI March 2020

Canada: Manufacturing PMI plunges in March

In March, the IHS Markit Manufacturing Purchasing Managers’ Index (PMI) decreased from 51.8 to 46.1 in March. The reading marked a near-decade low, consequently falling below the neutral 50-threshold, signaling a deterioration in manufacturing operating conditions from the previous month.

March’s outturn reflected sharp contractions in output and new orders, as Covid-19 took its toll on an already frail manufacturing sector. Moreover, factory shutdowns and border closures led to a fall in new export orders in March, while firms’ sentiment regarding future output growth weakened. On the price front, both input and output prices increased modestly in the month.

Commenting on March’s print, Tim Moore, economics director at IHS Markit, noted:

“Shrinking customer demand was almost exclusively attributed to production stoppages at home and abroad amid emergency public health measures to halt the COVID-19 pandemic. Some manufacturing companies cited an additional fall in new business related to a sharp drop in spending by clients in the energy sector.”

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