Canadian Factory Activity Hits Brakes with 3.3% Sales Drop, Signaling Economic Slowdown

This marks the third decline in the past four months, with notable decreases in transportation equipment and machinery. The pullback follows a modest 0.6% rise in December, which was boosted by the automotive sector.

Excluding motor vehicles and parts, manufacturing sales saw a slight increase of 0.1% in January. The preliminary estimate from Statistics Canada is based on a 72% response rate, with official results due March 13.

The article also provides context on the challenging year for Canadian manufacturers in 2025, citing U.S. trade policy and tariffs, which led to a 0.4% decline in sales for the year. Despite ongoing uncertainty, some signs of stabilization are emerging, as indicated by S&P Global's purchasing managers' survey showing a rise in its headline index to 50.4 in January.