Canada Factory Sector Expands to 52.9 on Stockpiling
The S&P Global Canada Manufacturing PMI reached 52.9 in May as firms increased output and new orders despite geopolitical uncertainty. Manufacturers reported higher demand and stockpiling efforts as clients sought to secure goods amid rising fuel prices and shipping delays linked to the war in Iran.
Canada manufacturing activity expanded for a second consecutive month in May as Middle East conflict concerns likely boosted client stockpiling. The S&P Global Canada Manufacturing PMI reached 52.9 last month, maintaining an expansion streak since January. The sector stayed above the 50.0 threshold despite slight declines in new orders and delivery deterioration to the steepest level since October 2022, alongside input costs at their highest since July 2022.
### Stockpiling Drives Sector Resilience The manufacturing sector remained above the 50.0 expansion threshold despite a slight decline from the 53.3 reading in April. Paul Smith, economics director at S&P Global Market Intelligence, said the expansion was supported by rises in both output and new orders. Firms reported success in securing new customers even as tariffs and uncertainty linked to the Middle East weighed on product markets.
