OTTAWA (Reuters) - Lending to Canadian small businesses slowed in October as the manufacturing and agriculture sectors pulled back with the broader economy expected to show a cooler pace of growth in the second half of 2017, data showed on Tuesday.
The PayNet Small Business Lending index declined to 111.4 from an upwardly revised 115.2 in September. Borrowing by medium-sized businesses also tumbled, with the index falling to 214.5 from 228.8.
The downshift in investment could be the result of companies getting ahead of themselves earlier in the year, PayNet President Bill Phelan said.
“It looks like a hiatus or a temporary hold on investment,” Phelan said.
Manufacturing was the main drag, with the measure of lending in the sector decreasing to 58.5 from 59.0.
Although many had hoped manufacturing would benefit from a weaker Canadian dollar in the wake of the oil price shock in 2014 and 2015, that never came to pass, Phelan said.
Among other sectors, agriculture fell to 193.5 from 197.3, and wholesale trade declined to 140.2 from 147.4.
The financial health of Canadian small companies continued to look strong, with the number of those that were 30 days or more delinquent falling to 0.88 percent from 0.91 percent. The rate of firms that were 90 days or more behind held steady at 0.28 percent.
Reporting by Leah Schnurr; Editing by Leslie Adler