‘Overall, the consensus-beating figures today, combined with the revisions, should have growth in Q4 tracking close to two per cent. That should remove further the possibility of a near-term ease from the BoC, despite its continuing dovish bias’. -Nick Exarhos, CIBC
Canadian manufacturing sales rose for the second consecutive month in December, official figures showed on Wednesday. According to Statistics Canada, sales advanced 2.3% on a monthly basis in December, the largest increase since 2015, following the preceding month’s upwardly revised gain of 2.3% and surpassing analysts’ expectations for an increase of 1.4%. In volume terms, manufacturing sales climbed 2.3% in the reported month, suggesting the Canadian economy performed well in the final quarter of 2016. Transportation sales jumped 7.4% in December, mainly driven by gains in the vehicle parts and assembly industries. Sales in the petroleum and coal product industry were up 11.6% amid the return of refineries from autumn maintenance. Wednesday’s data showed sales increased in eight out of 21 industries. In the meantime, inventories posted a third straight monthly decline of 0.3% in December, whereas new orders dropped 0.6%. Low-commodity prices and the Alberta wildfires dampened economic growth during the first three quarters of 2016. However, analyst suggest that the economy managed to fully recover by the end of the past year. The weaker Loonie, which dropped around 25% against the Greenback over the past five years, helped manufacturers offset low commodity prices.
