UPDATE 1-Canada factory sales drop by 0.3 pct in February

Tue Apr 17, 2012 8:39am EDT

* Sales drop on weakness in motor vehicle industry

* Analysts had expected a 0.5 percent fall

OTTAWA, April 17 (Reuters) - Canadian manufacturing sales fell for the second month in a row in February on weakness in the motor vehicle industry, Statistics Canada said on Tuesday.

Sales dropped by 0.3 percent from January to C$49.12 billion ($49.12 billion) and was less than the 0.5 percent fall expected by analysts. Statscan revised January's decline to 1.3 percent from an initial 0.9 percent.

Motor vehicle assembly sales were down 8.7 percent from January, the first fall since June 2011, while motor vehicle parts sales were off 7.2 percent. Separately, Statscan said seasonally adjusted new motor vehicle sales in February fell by 6.7 percent.

Overall, sales fell in 11 of 21 industries, representing about 64 percent of manufacturing. Sales in constant dollars -- used to calculate moves in real gross domestic product -- dropped by 0.1 percent.

New orders increased by 2.5 percent, the seventh gain in nine months, while inventories were up 0.3 percent. The inventory-to-sales ratio edged up to 1.34 from 1.33 in January.

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