S&P Global Economist Comments on Canada Manufacturing PMI in August

11:40 AM EDT, 09/02/2025 (MT Newswires) -- Canada's manufacturing economy continued to struggle in the face of tariffs and uncertainty in August, although, somewhat positively, to a noticeably lesser degree than earlier in the year, said Paul Smith, economics director at S&P Global Market Intelligence.

The Canada Manufacturing Purchasing Managers' Index (PMI), a composite index designed to provide an overview of the health of the manufacturing sector, recorded 48.3 in August, noted S&P Global in a statement on Tuesday. That was up from 46.1 in July and the highest PMI reading since January.

However, by remaining below the critical 50.0 no-change mark for a seventh successive month, the PMI signalled continued

sector contraction.

Although continuing to decline, output, new orders and employment all recorded slower falls compared to July, stated Smith.

Hopefully, the manufacturing economy will continue this broad underlying path towards stabilization, but the outlook remains extremely uncertain, with confidence remaining way below its typical trend level -- resulting in a significant downside risk to sector performance going forward, he pointed out.

In addition, adapting to the new international trading environment remains a challenge, with costs continuing to rise sharply, and customs and logistical challenges leading to further supply-side constraints, according to Smith.

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