Canada leading indicator shows housing decline in October

Wed Nov 28, 2012 9:20am EST
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* Indicator rises 0.2 percent in October, same as September

* Housing declines, manufacturing up

OTTAWA Nov 28 (Reuters) - A new Canadian composite leading indicator rose 0.2 percent in October, pointing to continued slow growth in coming months but with manufacturing and exports replacing the housing market as the main source of the expansion.

The gain in October matched a similar rise in September and showed strength in most domestic sectors despite the recession in Europe and uncertainty about the U.S. budget troubles, the Macdonald-Laurier Institute said on Wednesday.

The think tank designed and launched the index this year with the help of former Statistics Canada chief economist Philip Cross after Statscan discontinued its leading indicator.

"The housing sector has turned down, after leading growth in the spring," the institute said in a release.

"However, this softening has been outweighed by a rebound in the manufacturing sector and the stock market, after declines over the summer."

The housing index fell 1.7 percent in October for the fourth straight decline, although it fell less sharply than the 2.7 percent drop recorded in September.

New orders for durable goods rose 1.2 percent thanks to demand for aerospace products and steady gains in autos and housing. The average workweek in the manufacturing sector also climbed 0.3 percent.   Continued...