MNI:Canada Ivey PMI Declines,Consistent With Lower Price Index

By Yali N'Diaye

     OTTAWA (MNI) - The Canadian Ivey Purchasing Managers Index edged down five

points to 54.7 in January, still holding above the 50.0 mark indicative of an

expanding economic activity, according to data released Wednesday by the Richard

Ivey School of Business.

     The decline was consistent with a lower price index, since the PMI reflects

the value change of firms' purchases rather than the volume. The price index

fell to 57.4 from 64.6.

     The 3-month average for the Ivey PMI index has been trending down since

reaching a peak at 65.7 in June 2018.

     The employment index was also down in January, to 51.8 from 54.0, with

18.5% of respondents reporting higher employment and 23.9% reporting lower

employment. Statistics Canada will release its Labor Force Survey on Friday, and

analysts in a MNI survey expect little change from December: an increase of

5,000 in jobs creations, with the unemployment rate edging back up to 5.7% from

5.6%.

     The supplier deliveries index decreased to 41.7 from 43.8, while the

inventories index rose to 53.6 from 52.5.

     The decline in the seasonally adjusted PMI is consistent with the Bank of

Canada's projection of an economic slowdown in the fourth quarter of 2018 and

the first quarter of 2019.

     The unadjusted PMI index, however, remained below the 50.0 mark, signaling

an economic contraction. The index increased to 49.5 from 48.2. This is the

first time that the unadjusted PMI index was below 50.0 during two consecutive

months since Dec. 2014-Jan. 2015.

--MNI Ottawa Bureau; +1 613 869-0916; email: yali.ndiaye@marketnews.com

[TOPICS: MACDS$,M$C$$$]