- Benjamin Reitzes, BMO Capital Markets vice-president and senior economist
Purchasing activity in Canada unexpectedly accelerated last month, with the corresponding gauge jumping above the 62.0 level. Canada's Ivey PMI, which is based on a survey of 175 purchasing managers across the country, came in at 62.3 on a seasonally adjusted basis, supported by an increase in employment and inventory levels. The figure rose from 58.2 in April and overshot economists' expectations for a moderation to 55.5. The measure of employment climbed to 51.8 from 50.3, while inventories edged up to 59.5 from 53.2. The prices index was at 64.4 in May, indicating prices were higher than in the previous month. PMI includes the public and private sectors and consists of five categories: purchases, employment, inventories, supplier deliveries and prices. Meanwhile, investors will closely follow Canada's employment release scheduled for Friday. The economy is estimated to add 10,000 jobs in May, with the jobless rate remaining at 6.8%.
After a dismal first quarter, the Bank of Canada, International Monetary Fund and private-sector economists all expect the nation's economy to rebound in the second quarter. The Organization of Economic Co-operation and Development forecast the Canadian economy to enjoy a moderate growth of 1.5% this year, which will pick up to 2.3% in 2016. The think-tank revised its 2015 outlook down from a March estimate of 2.2%.
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