UPDATE 2-Canada factory sales bounce back after weather hit

Tue Mar 18, 2014 10:08am EDT
 
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* Sales rise 1.5 pct in Jan vs estimate of 0.6 pct gain

* Primary metals and food among main drivers of growth

* Inventories jump 3.6 pct in biggest gain on record

By Louise Egan

OTTAWA, March 18 (Reuters) - Canadian manufacturing sales bounced back more quickly than expected in January in a sign that the economy may be recovering from weather-related weakness at the end of last year.

Factory sales climbed 1.5 percent in January from December, Statistics Canada said on Tuesday. It was the briskest pace in nearly a year and well above the market forecast of a 0.6 percent gain, making up for the revised 1.5 percent downturn in December.

In volume terms, which matter most in measuring gross domestic product, factory sales expanded 0.7 percent.

Analysts welcomed the manufacturing bounce-back, which was likely helped by a weaker Canadian dollar, but they warned that the sector was still relatively weak in historical terms. Total sales were still below November 2013 levels and well below the pre-recession peak in 2008.   Continued...