Canada's Manufacturing PMI Slips, But Still in Positive Territory in May; Cost Pressures Intensify, Says S&P Global

09:53 AM EDT, 06/01/2026 (MT Newswires) -- Canada's manufacturing sector growth was sustained in May as output, new orders and employment all increased, said S&P Global on Monday.

The seasonally adjusted S&P Global Canada Manufacturing Purchasing Managers' Index (PMI), a composite index designed to provide a summary of operating conditions in manufacturing, remained in positive territory during May for a second successive month.

Although falling to 52.9 from 53.3 in April, the rate of growth remained "solid" and above its historical average, said S&P Global.

Manufacturing sector expansion was underpinned by further lifts in both output and new orders amid reports of higher demand and success in securing new customers, while employment growth was sustained as firms noted some pressure on current capacity, it added.

However, S&P Global also noted, price indices shifted upwards, hitting a near four-year high, whilst input delivery times deteriorated markedly as the Middle East conflict weighed heavily on supply chains.

Confidence in the outlook subsequently remained subdued, as manufacturers signaled a considerable and accelerated increase in input costs over the month, it said.

Linked to the war in Iran and the inflationary impact this has had on global energy and oil prices, manufacturers reported the steepest increase in overall input costs since July 2022, S&P Global noted. Suppliers were reported to have generally increased their charges, whilst freight and transportation costs also rose. United States tariffs were still noted as a factor driving up input expenses, it added. In response, manufacturers similarly raised their own selling prices sharply, according to S&P Global.

Finally, staffing levels were increased for a second successive month and, although modest, the rate of growth was the strongest since October 2024, it noted.

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