Wednesday, May 18, 2016

March Factory Sales Down 1.9% in Ontario

Michael Babad has an article in the Globe going over manufacturing capital spending and production and the fact that the numbers aren't good.

One number that jumped out was that while factory sales dropped 0.9% overall in Canada in March, it actually dropped 1.9% in Ontario. Likely that has to be somewhat automotive related and correlated to the weakness in the US economy over the last several quarters. Also the loonie was weak, but not as weak as in February.

It will be interesting to see the effect the lower factory sales in March have on first quarter Ontario GDP. Lower factory sales likely mean lower car exports to the US, which directly hits GDP. However the housing market is still on fire in Ontario so GDP could still be decent.

Gas prices have been creeping up lately, but in the first quarter they were still really low, so that's good for Ontario GDP. We'll see what happens.

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