The S&P Global Canada Manufacturing PMI declined to 49.6 in October 2026 from 51.5 in September, marking the first contraction of the year. Output fell for the first time since March, as worsening delivery delays led to the sharpest deterioration in supplier performance since August 2022. In response, manufacturers increasingly drew down existing inventories, with stocks of purchases declining for a second consecutive month.
New orders shrank at the fastest rate in over a year, as tariffs and heightened geopolitical uncertainty dampened both domestic and external demand. New export orders fell for the fifth consecutive month, posting their steepest drop since January.
At the same time, input cost inflation accelerated to its highest level since June 2022, driven by tariffs and higher fuel prices. Manufacturers passed these increases on to customers, pushing output price inflation to its strongest level in more than four years. Employment declined for the first time since March, while business confidence remained historically weak.
