Statistics Canada says manufacturing sales up 0.8% in June

“After what has been a fairly dismal run, the June manufacturing data represents a welcome bright spot,” TD Bank economist Brian DePratto said.

“The forecasted second-quarter contraction is thus likely to be a blip. Many of the temporary setbacks that dragged Q2 lower have already reversed, setting the stage for relatively healthy growth and a resumption of the economic rotation process over the latter half of this year.”

The increase in sales was due to higher purchases of machinery and transportation equipment products. On a constant dollar basis, overall sales gained 0.5%, indicating a higher volume of goods sold.

The machinery industry gained 5.8% at $2.7 billion, following five consecutive monthly declines, while the transportation equipment industry added 1.4% to total $10.7 billion in June.

Inventory levels fell 0.2% to $70.6 billion in June, the fifth consecutive monthly move lower, while unfilled orders climbed 1.6% to $90.4 billion, a third consecutive monthly increase.

May was hurt by an earthquake in Japan that disrupted the auto sector, while the Alberta wildfires also hurt sales.

Statistics Canada said in June that 118 manufacturers, or about 3.2% of those surveyed, reported being affected by the wildfire and evacuation of Fort McMurray, Alta. That was down from 194 in May.

Of those that reported an impact on their business in June, the agency said about 38% were able to quantify the effects, with the majority reporting a loss of sales.

Statistics Canada said that because of the wildfire, national sales in the machinery and fabricated metal product industries in June were lower than they would have been.

Manufacturing sales in June were up in four provinces, led by Ontario.

Ontario rose 1.4% to $24.7 billion in June, while Alberta gained 1.8% to $5.2 billion. New Brunswick fell 4.1% to $1.3 billion.