Canada's Manufacturing Sector Contracts for 11th Month, Weakening Loonie
Canada's manufacturing sector contracted for the 11th consecutive month in December 2025, with the S&P Global PMI at 48.6. This ongoing contraction is contributing to the Canadian dollar's decline against a strengthening U.S. dollar.
Insights:
Canada's manufacturing sector continued its downward trajectory in December 2025, marking the 11th consecutive month of contraction with the S&P Global Canada Manufacturing Purchasing Managers Index (PMI) registering a reading of 48.6. This slight increase from November's 48.4 still falls below the critical 50 threshold, indicating persistent weakness in the sector. The prolonged contraction has been a significant factor in the Canadian dollar's depreciation, which slipped 0.1% on Friday and 0.5% over the week, trading at 1.3740 per U.S. dollar. The loonie's annual performance, however, showed a gain of 4.8% for 2025.
