Key insights
- Canadian economic activity contracted in March, with the Ivey PMI falling below 50 for the first time in four months. Rising price pressures contributed to the contraction. While primarily a Canadian indicator, it can signal potential headwinds for the US economy due to close trade ties, suggesting a slightly bearish influence on US equities.
TORONTO, April 7 (Reuters) - Canadian economic activity contracted in March for the first time in four months as a measure of inflation pressures increased, Ivey Purchasing Managers Index (PMI) data showed on Tuesday.
The seasonally adjusted index fell to 49.7 last month from 56.6 in February, marking its first move below the 50 threshold since November.
The Ivey PMI measures the month to month variation in economic activity as indicated by a panel of purchasing managers from across Canada. A reading below 50 indicates a decrease in activity.
The inventories index fell to an adjusted 49.4 from 57.2 in February, while the prices index was at 75.7, up from 63.4.
The unadjusted PMI edged up to 56.5 from 56.3.