Canadian manufacturing sales fell again in Feb, declining 1.7%, following a downwardly revised contraction of 3.0% in January. The fall in sales was the result of declines in the volume of sales, as real manufacturing sales were down 2.5% m/m in Feb. In both real and nominal terms, manufacturing sales have now fallen in 4 of the last 5 months of data.The outlook for manufacturing sales continues to soften, as unfilled orders fell 1.2% in Feb, and new orders were down by 17.7%, the largest decline since March 2014. At the same time, inventories were up 0.9%, moving the inventory-to-sales ratio up slightly, to 1.44.“Feb manufacturing sales data continues the trend of disappointing economic data since the start of 2015. While much of Feb’s weakness is likely to be temporary due to automotive plant shut-downs, the forward-looking indicators suggest that any rebound in sales, if it occurs, is likely to be somewhat muted. On balance then, this morning’s data remains consistent with first quarter Canadian growth of near 0%. We continue to expect that the low level of the Canadian dollar and an anticipated acceleration in the U.S. economy will help drive a recovery in growth later in 2015.” said TD Economics
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