Canadian Wholesales Unexpectedly Decline on Weak Machinery Sales

(Bloomberg) -- Canada’s wholesalers posted a surprise decline in August as machinery and equipment sales pulled back.

Canadian wholesales fell 1.2% in August, Statistics Canada reported Wednesday from Ottawa. That missed the 0.3% gain that economists surveyed by Bloomberg were expecting.

Decreases were widespread, with five of seven subsectors declining. Stripping out price effects, wholesale volumes fell 1.3% from July.

Machinery and equipment fell for the second month in a row, leading declines and falling 2.6% in August. Construction, forestry, mining, and industrial machinery and equipment were the main downside contributors. A continued slowdown in these sectors may be worrying signal when it comes to the investment outlook in Canada.

Canadian Wholesales Unexpectedly Decline on Weak Machinery Sales

Wholesale inventories also fell for the first time in a year, down 0.3% in August. Still, the inventory-to-sales ratio ticked up to 1.45, remaining at one of the highest levels since the early 1990s -- a possible risk to future growth prospects.

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