(Adds details from report, economic context)
OTTAWA, Aug 14 (Reuters) - Canadian manufacturing sales jumped in June on increased sales of chemical products and motor vehicles, data from Statistics Canada showed on Friday, providing a welcome sign of activity in the economy at the end of the second quarter.
Factory sales rose 1.2 percent, the biggest gain since March, though sales still fell short of economists’ forecasts for a more robust gain of 2.1 percent. It was the second monthly increase. In volume terms, sales rose 0.5 percent.
New orders rose by 0.6 percent, while companies continued to draw down their inventories, which fell 0.5 percent. The inventory-to-sales ratio fell to 1.42 from 1.44 in May.
Sales were higher in 18 of 21 industries, which accounted for 80 percent of the manufacturing sector. Chemical products climbed 5.4 percent and motor vehicle sales gained 4.2 percent.
The economy may have been in recession in the first half of the year and the Bank of Canada has cut interest rates twice in 2015 so far as the oil-exporting country has felt the pain of cheaper crude prices.
The manufacturing sales report follows data earlier this month that showed the export sector snapped back in June. The two reports could provide support to the view that the economy will pick back up in the second half of the year.
Reporting by Leah Schnurr; Editing by Nick Zieminski