3. SUMMARY
The headline gain in manufacturing sales was weaker-than-expected in the wake of a sharp bounce-back in non-
energy ex-ports in the month but a stronger gain in volume terms none-the-less still points to the sector
remaining a support to GDP growth in July. Oil production likely continued to recover in July from wildfire-
related shutdowns in May which, combined with the trade and manufacturing data released to-date, remains
broadly consistent with our view that overall GDP will post an-other large gain in the month (following a 0.6%
jump in June) that would leave the data tracking in line with our call for a 3.7% (annualized) bounce-back in GDP
in Q3 following a 1.6% drop in Q2. Although still early, data to-date supports the view that weakness in Q2
reflected more transitory disruptions than a shift in the underlying trend pace of growth in the economy. We
continue to expect, broadly in line with the Bank of Canada’s view, that underlying activity will strengthen
modestly over the second half of this year as non-energy exports rise and the drag from the oil & gas sector
continues to ease.
Source – RBC
6. KEY QUOTES
Analysts in a Reuters poll had forecast a 1.0 percent increase from June.
Sales advanced in nine of 21 industries, representing around 54 percent
of the manufacturing sector while in volume terms, sales climbed by 0.6
percent. Food industry sales rose by 1.9 percent, in part because
manufacturers were able to overcome supply difficulties that had
caused shortages of canola in May and June. Sales in the primary
metals industry rose by 2.9 percent while petroleum and coal products
posted a 2.5 percent gain on higher volumes at several oil refineries.
Production in the aerospace and products parts industry - known for its
volatility - sank by 9.0 percent while machinery sales fell by 3.3 percent.
Source: Reuters