Canadian October S&P Global services PMI 46.6 vs 47.8 prior
<ul><li>Prior was 47.8</li><li>The latest decline in business activity was closely linked
by panellists to a reduced level of new work. </li><li>Companies
reported that new work received was down for a third month
in a row, and to the greatest extent for over a year.</li><li>Panellists widely commented on raising typical wage levels
in October, largely to help staff with living expenses and to
retain workers</li></ul><p>This is a new release from S&P Global but the data collected for it goes back to 2017.</p><p>Paul Smith, Economics Director at S&P Global Market
Intelligence, said:
</p><blockquote>“The first public release of the S&P Global Canada
Services PMI showed that the nation’s vast services
economy, the key contributor to overall economic output
in Canada, remained mired in contraction territory
during October. Moreover, operating conditions faced
by service providers are worsening at a greater pace,
with both activity and new business declining to their
greatest degrees since August 2022.
</blockquote><blockquote>“Firms were clear on the reasons behind the challenging
market environment they currently face, reporting
that elevated prices, the high cost of living and high
interest rates were leading to budget cuts and reduced
discretionary spending amongst clients.
</blockquote><blockquote>“This suggests that the Bank of Canada’s sustained
period of rising interest rates is having a dampening
effect on economic activity. However, data from the
PMI survey encapsulates the challenges the central
bank currently faces, and why it continues to adopt its
hawkish stance. Firstly, the labour market remains tight,
with October’s survey suggesting that firms continue
to recruit staff, especially skilled workers. Secondly,
elevated wage growth is leading to stubbornly high
inflation.”
</blockquote><blockquote>“Whilst the release of new timely PMI data will be
welcomed by policymakers, it nonetheless reinforces
the current tightrope they have to walk between bringing
inflation down on the one hand and avoiding economic
recession on the other.”</blockquote>
This article was written by Adam Button at www.forexlive.com.
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