Canadian manufacturing sales surged 2.9% in March, reversing a good chunk of the 5.2% drop in the prior two months and the best gain in nearly four years-February's drop was revised to -2.2% from -1.7% initially. The increase was driven largely by the transportation sector which climbed 13.5% in the month. Aerospace rocketed 42.3% higher, and autos were up 12.8%.
The big gain in manufacturing volumes is an encouraging sign for March GDP following a very difficult start to the year for the Canadian economy. However, manufacturing volumes still fell at an 8% annualized pace in Q1, the worst reading in four years.
"While the March report could be a sign of better times ahead for the Canadian economy, look for much more modest growth from manufacturing in the coming months rather than repeats of March's blowout gain." said BMO Capital Markets
