MNI DATA IMPACT: Canada Factory Sales Fall Amid Rail Strike>

By Greg Quinn and Anahita Alinejad

     OTTAWA (MNI) - Canadian factory sales fell for the fifth time 

in six months in November as a railway strike triggered the biggest drop 

in metals shipments in a decade.

     Sales fell 0.6% to C$57 billion, Statistics Canada said Tuesday 

from Ottawa, more than the MNI economist median showing a 0.4% fall. 

Primary metals sales dropped 12% to C$3.8 billion as a CN Rail strike 

disrupted shipments, the biggest drop since December 2008. 

     The decline came even as auto parts production rebounded with an 

8.8% gain following the end of another strike by UAW workers. Excluding 

autos and parts, sales fell 1.2% in November, with declines in 11 of 21 

industries including food and chemicals.

     The November decline was bigger than expected in part because 

Statistics Canada pared its estimate of the October decline to 0.2% from 

0.7%. Factory sales have weakened for most of this year, putting an end 

to a long expansion that went back 2016. Factory sales have slipped 0.1% 

in November from a year earlier. 

     Manufacturing is one of the industries at greatest risk for damage 

from global trade disputes that slow economic growth and force companies 

to break up their supply chains. The Bank of Canada has a decision 

Wednesday where it's expected to hold the G7's highest interest rate at 

1.75%, balancing trade risks against what it has called resilient 

domestic spending that has kept the economy close to its full potential. 

     Factory inventories remain bloated, rising two notches to 1.54 in 

October. That brings it closer to a July peak of 1.55 -- the highest 

since the last recession in 2009. That suggests even if demand picks up 

following a U.S.-China trade deal and lower Brexit tensions, it may take 

a while to work off stockpiles and generate new sales.

--MNI Ottawa Bureau +1-613-314-9647; greg.quinn@marketnews.com  

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