OTTAWA: Canadian factory sales rose for a fourth straight month in September, beating expectations on strong gains in the railroad-equipment and motor-vehicle sectors.
The value of factory sales rose 0.3% to 51.47 billion Canadian dollars ($38.28 billion) in September from August, Statistics Canada said Wednesday. That surpassed the 0.1% gain economists had expected, according to Royal Bank of Canada. In volume terms, September factory sales fell 0.2%. Sales rose 1.4% on a year-over-year basis.
Despite the September dip in volumes, manufacturing sales should still provide a boost to Canada’s overall economic growth in the third quarter, Toronto-Dominion Bank economist Dina Ignjatovic said.
“Going forward, we expect manufacturing sales to remain healthy,” she said in a note.
Sharply lower global commodity prices have weighed heavily on Canada’s economy, which once counted energy products as its top export. The Bank of Canada expected non-resource exports, including manufactured goods, to help make up the difference, but acknowledged recently that progress has been slower than anticipated.
Last month, the central bank cited lost export capacity and competitiveness challenges as factors that could lead to a permanent drop in Canada’s export outlook. On a year-over-year basis, factory sales rose 1.4%.
Sales of transportation equipment rose 1.5% in September, to C$10.65 billion, led by a nearly 73% gain in railroad-equipment sales and a 1.3% advance in motor-vehicle sales. The advance in transportation equipment accounted for more than 85% of the total monthly gain in manufacturing sales, Statistics Canada said.
A 2.4% increase in fabricated metal products, to C$2.72 billion, also contributed to the September advance. That sector recorded its largest monthly gain since May 2015.
The gains were partially offset by a 3.4% decline in the primary metal product industry, to C$3.78 billion. The September decline was mostly due to lower sales in the iron and steel mills industry and in aluminum production, the data agency said.
