Canadian factory sales experienced a second consecutive monthly increase in August, driven by higher oil prices and strong growth in the food sector. According to Statistics Canada, manufacturing shipments reached a seasonally adjusted 72.36 billion Canadian dollars ($52.97 billion) during the month.
Although slightly lower than the agency’s initial estimate of a 1.0% rise, the actual increase of 0.7% follows a 1.6% jump in July. Adjusting for price changes, manufacturing sales decreased by 0.7% to C$56.40 billion in August, indicating that the rise was mainly due to higher prices.
Sales of petroleum and coal products saw a second consecutive monthly increase, reflecting concerns about ongoing oil production cuts by the Organization of the Petroleum Exporting Countries (OPEC) and its partners. Food sales also reached a record high thanks to increased demand and higher prices for bakery and tortilla products as well as meat.
The machinery sector also experienced strong growth, reaching a new record high mostly due to sales of industrial machinery. However, the motor vehicle industry faced weaker sales, with a 1.5% decrease in vehicle sales from the previous month. Excluding motor vehicles, parts, and accessories, manufacturing sales were up 1.0%.
Factory inventory levels dropped by 0.1% in August, reaching the lowest level since January, primarily due to reduced stocks of chemicals and primary metals. On the other hand, unfilled orders rose by 0.5%, indicating potential future sales if these orders are not cancelled, while new orders increased by 2.8%.
In recent months, Canada has experienced a significant slowdown in economic activity due to rising borrowing costs. The central bank has been increasing interest rates for the past 18 months to combat inflation.
