OTTAWA (Reuters) - The pace of Canadian manufacturing sales slowed in September, while volumes fell, data from Statistics Canada showed on Wednesday, suggesting a softer transition for overall economic growth heading into the final quarter of the year.
The 0.3 percent increase in sales topped economists’ expectations for a gain of 0.1 percent, though it was a step down from August’s hefty 0.9 percent increase.
It was also driven largely by gains in the transportation equipment sector. Although sales were up in 12 out of 21 industries, a 1.5 percent increase in the sector accounted for more than 85 percent of the total gain in manufacturing sales.
The volume of goods sold in September, which strips out the effect of changes in price and is watched by economists, declined 0.2 percent.
Economic growth is expected to have snapped back strongly in the third quarter as a whole following a contraction in the previous quarter but that rate is not expected to be sustained in the last three months of the year.
Robert Both, macro strategist at TD Securities, said the fourth quarter was on track for annualized growth of 1.5 percent, in line with the Bank of Canada’s recently downgraded forecast.
The forward-looking new manufacturing orders measure rose 2.3 percent on increases in the transportation equipment and machinery sectors. Inventories also rose 0.5 percent, with increased stocks seen in the transportation equipment, food and chemical industries.
Statistics Canada revised seasonally adjusted data for sales, inventories and orders going back to January 2011, while the unadjusted figures were revised back to January 2013.
Reporting by Leah Schnurr; Editing by Jeffrey Benkoe and W Simon