Catalogue number: Catalogue number: 36-26-0001
Issue number: 2018002
Release date: August 24, 2018
Review of Economic Statistics — August 24, 2018 - Transcript
(The Statistics Canada symbol and Canada wordmark appear on screen with the title: "Review of Economic Statistics — August 24, 2018")
(Background music plays while title card with the text "Review of Economic Statistics" appears on screen.)
Richard Evans: Welcome to the Review of Economic Statistics. I'm Richard Evans.
Guy Gellatly: And I'm Guy Gellatly.
(Text on screen below presenters: "Richard Evans, Director General, Industry Statistics. Guy Gellatly, Principal Researcher.")
Richard Evans: Guy, we have a real banquet of numbers in front of us today, what with the June manufacturing and retail reports and the July inflation report. So, I thought we'd start with manufacturing. Manufacturing in May showed strong growth at 1.5%. Did the June manufacturing growth match that?
Guy Gellatly: Not quite, Richard, but we did see continuous strength into June. Manufacturing sales up 1.1%. So, basically, two solid gains to end the quarter. A lot of the strength in the June report was really coming from higher sales of petroleum and coal products. So, we had several refineries there that ramped up production levels, and that follows some maintenance and some shutdown activity that we saw in April and May.
(Text on screen below presenters: "Manufacturing sales rose 1.1% in June.")
Richard Evans: Alright. So, those are two strong growth rates, as I just mentioned. That's bound to translate into a strong quarterly growth for Q2. Was that the case?
Guy Gellatly: Overall, manufacturing sales up about 2.5% for the quarter. It's interesting—a lot of that strength is really coming on the prices side. In fact, if you look at a lot of the trend strength in manufacturing sales over the first half of the year, prices are a pretty important part of supporting that. So, if you go to our industrial product prices release, and that basically gives you the prices that manufacturers receive as products leave the factory gate. Those prices have been strong, now—for six months in a row we've seen increases.
Richard Evans: Yeah. So, a bit of a price story there. Let's look at retail now. Retail had very strong growth in May: 2.2%. I understand that wasn't the case in June.
Guy Gellatly: No, retail edged down slightly in June, down 0.2%, and if you look back at a lot of that strength in May, it was really coming on higher sales at auto dealers, higher sales at gasoline stations. Some pull-back in those numbers in the June report. So, if we look for the quarter as a whole, retail up about 1%, largely on the volume side. And if you look at volumes generally, they've been pretty strong in sort of shaping that overall trend that we've seen in retail over the last half-year or so.
(Text on screen below presenters: "Retail sales edged down 0.2% in June.")
Richard Evans: Yeah. So, let's talk about inflation. Because there wasn't much retail inflation, anyway, in the second quarter, as you've just been explaining. But I understand the July report showed some strength, and that energy prices may have helped boost those numbers.
Guy Gellatly: Headline inflation basically 3% in July. That's the first time that we've been at that 3% mark since 2011. Energy prices certainly an important contributing factor there, as they have been really over the last several months. So, if we look at gasoline prices, they're basically up 25% year over year. So, 25% higher this July than they were last July, and they've been slightly over that 20% mark now for three consecutive months. So, if you take gasoline out of the mix, the overall inflation would have come in about 2.2%.
(Text on screen below presenters: "Consumer inflation accelerated to 3.0% in July.")
Richard Evans: Now, I think a couple of other items also contributed to boosting that inflation rate a little bit.
Guy Gellatly: Yeah, some of the acceleration actually coming from higher prices for air transportation, higher prices for travel tours, and that reflects some of the price adjustments that we see around peak travel season.
Richard Evans: Great. And Guy, in closing, I'd love to hear your views about August's employment report.
Guy Gellatly: And Richard, we will address that. I'd be happy to do so in our next edition, where we'll look at the LFS, and we'll also, of course, look at the GDP report for the second quarter.
Richard Evans: So, looks like we'll just have to be patient. Thank you for joining us.
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