A bright spot for our economy in July.
Figures released by Statistics Canada revealed that manufacturing sales jumped a stronger-than-expected 1.7% in July following a revised 0.1% decline (previously was -0.5%) in June. The gain in July reflected relatively broadly-based strength that more than offset the broadly-based weakness seen in June. Sales of petroleum and coal (2.4%), "miscellaneous" products (23.9%), fabricated metal products (5.9%) and motor vehicles (3.5%) all provided solid support. The main source of partial offset came from the volatile aerospace sector, where sales dropped by 17.3% following an 11.6% jump in June.
Regionally, a 2.1% gain in sales in Alberta may have reflected some reversal of negative flood impacts in June; however, this appeared to be a relatively small part of the story with sales also rising solidly in the rest of the country, led by a 3.2% rebound in sales in Ontario.
"The rebound in the volume of manufacturing sales in July," to quote experts at RBC Economics, "is encouraging and suggests that, while not significantly related to flooding in Alberta, weakness in June was nonetheless temporary.
"While challenges for the sector remain," Canada's largest bank concludes, "we expect that stronger growth externally, particularly in the United States, will support stronger manufacturing activity over the second half of this year and into 2014."
