* PMI rises to 50.1 in April from 49.3 in March
* New export orders strongest in 6 months, helped by U.S.
* Output prices rise faster than input costs
* Quebec reports gains in output, net export work, jobs
By Alastair Sharp
TORONTO, May 1 Canada's manufacturing activity
eked out the smallest of expansions in April after shrinking in
March but the sector did see an encouraging rise in new orders
from abroad, according to data released on Wednesday.
The RBC Canadian Manufacturing Purchasing Managers' Index
was at 50.1 last month after adjusting for seasonal variation,
up from 49.3 in March. A reading above 50 represents expansion,
while a number below means contraction.
The manufacturing data, based on a survey of about 400
companies, offers one of the earliest indicators of the pace of
"Canada's manufacturing sector kept its head above water in
April, registering some improvement over the surprising series
low recorded last month," RBC's chief economist, Craig Wright,
said in a statement accompanying the data release.
"While the overall gains made in April were tepid, we expect
manufacturing output to pick up, augmenting export activity
and supporting Canada's growth prospects," he said.
Canada's economy recorded its weakest six months since the
2008-09 recession at the end of 2012, but has since notched
surprising 0.3 percent growth in gross domestic product for both
January and February.
Many of the RBC PMI sub-readings for April were little
changed from the prior month, with output improving but still
under the neutral 50 mark and employment growth slipping.
Cost burdens rose at their weakest rate since July 2012,
while factories raised their output prices by more.
But factory owners did report their strongest rate of growth
in new export orders in six months, which was generally
attributed to winning business in the United States. Inventories
of finished goods increased for the first time in 2013.
"A return to growth for new orders, partly reflecting a
modest rise in new export work, may lead to an increase in
production over the coming months," Cheryl Paradowski, chief
executive of the Purchasing Management Association of Canada,
said in a statement.
"In the meantime, manufacturers' profitability is protected
to some extent by output charges rising at a faster rate than
input costs," she said.
Regionally, weakness was reported in Alberta and British
Columbia, and Ontario, while Quebec notched gains in output, net
export work, and employment.
Monthly gross domestic product data for February released on
Tuesday by Statistics Canada showed 0.3 percent expansion on the
back of strength in potash mining, oil and gas, and
The hard-hit manufacturing sector continued to recover with
0.8 percent growth, the government agency said.