Led in part by the plastics sector, Canada’s factory sector continued to show gains in March 2014, with a post-recession high of $50.9 billion in seasonally adjusted sales that built on a stronger-than-expected result in February.
As reported by Canadian national news outlets, economists had been expecting a slight decline after February’s 1.4 per cent expansion, but sales rose 0.4 per cent in value terms and an even healthier 0.5 per cent in volumes in March, with food, machinery, and plastics and rubber product industries leading the way.
Overall, sales were up in 11 of 21 industries, representing approximately two-thirds of the manufacturing sector. Increases were largely offset by declines in the paper and petroleum and coal products industries.
The gathering factory sales momentum is helped by a weaker Canadian dollar and improved demand in the U.S., destination of about three quarters of the nation’s exports. The American economy will expand 2.5 per cent and 3.1 per cent over the next two years, from 1.9 per cent last year, according to median forecasts in a Bloomberg News survey.
Despite the good news, Statistics Canada was cautious in its reporting of the March results, noting that new factory orders generally “returned to normal levels after a jump in February.” Last month, the agency said the transport category led the biggest gains in unfilled and new orders in records going back to 1992.