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Canadian Manufacturing Sales Jumped Higher in November


  • Manufacturing sales jumped 3.4% in November, and 2.5% controlling for the impact of price gains.
  • Motor vehicle sales bounced back after transitory disruptions in earlier months and chemical sales increased sharply in November.
  • The jump in manufacturing sale volumes suggests overall GDP may have bounced back 0.3% in November after an unexpectedly soft flat reading in October.

Our Take:

Nominal sales jumped 3.4% in November – the fastest one-month gain since March 2015 – after falling 0.6% in October. About a percent of that increase was due to higher prices, largely a 6% jump in petroleum prices. Volume sales were still up 2.5%, though, led by a 14.7% (12.9% in nominal terms) bounce-back in manufacturer motor vehicle sales following transitory production disruptions in earlier months. Chemical sale volumes also bounced back, rising 5.0% after a 3.7% drop in October. Machinery sale volumes dipped lower for a second straight month but were still up 14% from a year ago. NAFTA uncertainty remains a risk to the outlook, particularly for manufacturers, but the still-strong level of domestic manufacturer machinery sales coupled with an earlier-reported surge in equipment imports in November suggest that Canadian businesses continued to increase investment in Q4. The outsized pace of overall GDP growth from mid-2016 to mid-2017 was never likely to be sustained for a long period of time. Today’s data adds to the list of indicators – not least of which is the solid labour market data – suggesting that although growth has slowed somewhat, the economy remains on a firm footing.

RBC Financial Group
The statements and statistics contained herein have been prepared by the Economics Department of RBC Financial Group based on information from sources considered to be reliable. We make no representation or warranty, express or implied, as to its accuracy or completeness. This report is for the information of investors and business persons and does not constitute an offer to sell or a solicitation to buy securities.

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