The S&P Global Canada Services PMI rose to 46.5 in February 2026 from 45.8 in January, indicating a slower pace of contraction in activity. New orders fell for the fifteenth consecutive month, but the rate of decline was the mildest since October 2025. With demand still subdued, firms either chose not to replace departing staff or implemented layoffs, leading to a sixth straight monthly drop in employment.
Input cost inflation continued to ease, reaching its lowest level since September 2024, while output prices increased at a slightly faster pace, though still well below the rate of input cost growth. Business confidence edged up to its highest point since October 2025, supported by expectations of an improvement in demand, in part due to upcoming sporting events that are anticipated to boost tourism in Canada.
