Canadian Business Sector Performing Better Than Expected, Though Shipments Still Bottoming

Canadian Ivey PMI (APR)

Actual: 57.6
Expected: 54.0
Previous: 59.0

Activity in Canada's business sector was stronger in April than economists and traders had suspected, suggesting demand from the US was holding up and commodity exports were filling in for the growing shortfall in durable goods and service demand. According to the joint measure by the Richard Ivey School of Business and Purchasing Management Associatoin of Canada, overall activity cooled modestly for a second month to 57.6 from a 59.0 reading from last month and 62.0 in February. However, while headline figure did mark a three month low, the slip was far smaller than decline to 54.0 expected. What's more, the guage is safely in expansionary territory (denoted by a reading above the 50 contraction/expansion level) and the less-volatile three-month moving aveage has risen to a new multi-month high. Looking through the statistical breakdown, the indicator is on a little more shakey ground. While the employment component rose to a five-month high, the remaining data reflected a sharp jump in prices (from 68.7 to 80.7), a rise in inventories and a new four-year low in supplier deliveries. Looking ahead, Canadian business trends will rely heavily on the level of the Canadian dollar and the attitudes of American consumers.

DailyFX

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