Canada: Manufacturing PMI ticks up marginally in November
In November, the IHS Markit Manufacturing Purchasing Managers’ Index (PMI) increased slightly to 55.8 from 55.5 in October. The index remained well-above the neutral 50-threshold, signaling an improvement in manufacturing operating conditions from the previous month.
In November, output increased robustly, but the slight uptick in the headline reading was predominately driven by solid expansions in new orders and job creation. Moreover, despite increased employment backlogs of work continued to rise, indicating firming domestic demand conditions—travel and trade restrictions remained a key drag on exports in November. On the price front, input price inflation rose due to higher costs for raw materials, while output price inflation also increased in November. Lastly, business confidence increased in November as the majority of manufacturing firms expected stronger production levels for the year ahead due to the fading impact of Covid-19.
Commenting on the print, Shreeya Patel, economist at IHS Markit, noted:
“Looking ahead, the increasing number of COVID-19 cases has led to tightening lockdown restriction in major manufacturing regions. With a resurgence in case numbers, and further lockdown measures announced, the sector could face softer growth prospects or a second dip in the coming months.”