"Now that interest rates appear to be going nowhere fast, sales activity in the near term may be held in check by homebuyers who are in less of a hurry to purchase"
- Gregory Klump, the real estate association's chief economist
Canada's factory sales increased to the highest level in more than a year in September as automakers presented new models and grain mills resumed production. Sales rose 0.6% to C$49.9 billion, the highest since June 2012, increasing in 11 of 21 categories tracked by Statistics Canada, compared to economists' forecasts of 0.5%. Although, production is 1% above the levels seen a year earlier, it remains 1.3% below the post-recession peak set at the end of 2011. According to the Bank of Canada, business investment and exports remain weak in an economy driven by consumer spending, as companies wait for signs of expansion abroad. Inventories fell 0.9% to C$68.2 billion, while motor vehicle assembly inched up 5.4% to C$4.70 billion in September, and auto parts sales rose 2.5% to C$1.96 billion. Food manufacturing rose 2.6% to C$7.46 billion, the fastest since December.
Meanwhile, Canadian existing home sales declined 3.2% in October from a month earlier, the biggest drop in more than a year, as Bank of Canada Stephen Poloz dropped language about the need to raise rates last month, easing pressure on buyers. Unit home sales fell to 39,235 throughout the month, down from 40,545 in September, whereas home prices dropped 1.1% to C$399,277.
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