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Canadian Manufacturing Rebounds in December
18 Feb
Summary
- Canadian manufacturing sales increased 0.6% to C$71.0 billion in December.
- Motor vehicle sales jumped 12%, aided by a plant reopening.
- Bank of Canada kept interest rates unchanged at 2.25%.
Canadian factory shipments experienced a positive uptick in December, growing by 0.6% to reach C$71.0 billion. This recovery followed a decline in November and was largely propelled by a robust 12% surge in motor vehicle sales.
The automotive sector's performance was significantly influenced by the full reopening of a major assembly plant in Ontario, which had been operating at reduced capacity due to semiconductor chip shortages. Food product sales also played a role in bolstering the overall manufacturing figures for the month.
Economic conditions remain under scrutiny, with the Bank of Canada announcing on January 28th that it would hold its benchmark interest rate steady at 2.25%. Officials indicated that future rate decisions are contingent on the economy aligning with the central bank's projections and managing uncertainties.
Concerns about trade policy and tariffs, particularly those imposed by the U.S. administration, continue to cast a shadow over the manufacturing sector. Uncertainty is expected to persist throughout the year, especially with the North American free trade pact undergoing review.
