The RBC Purchasing Managers' Index showed a reading of 52.0 in July, which indicated business conditions continued to improve with the measure remaining above the 50 "no-change" level.
However, the bank also says this did represent a slight moderation in the pace of improvement given readings in June and May of 52.4 and 53.2, respectively.
That said, the July PMI is still up from stagnant readings between November and April where the index averaged only 50.4. These earlier low PMI readings likely reflected uncertainty about "external headwinds" related to resolving fiscal imbalances in both the U.S. and the euro area.
The bank also says, "with these concerns easing, sentiment in manufacturing has rebounded, although the pace of improvement remains very modest and thus reason for the Bank of Canada to keep monetary conditions highly accommodative to try and ward against any relapse in sentiment going forward."
