Canada's Ivey PMI slows to four-month low as employment declines

Canadian economic activity expanded at a slower pace in July, with the Ivey Purchasing Managers' Index (PMI) falling to a four-month low.

The seasonally adjusted index showed a deceleration in growth momentum, driven by a decline in employment measures and accelerating price increases among surveyed firms.

The data highlights a divergence in the North American economic landscape.

While US private sector activity accelerated sharply in July, with the S&P Global composite PMI rising to 53.6 from 51.9 in June, Canada's private sector is showing signs of fatigue.

The drop in the Ivey PMI suggests that domestic demand is cooling, even as inflationary pressures within the supply chain intensify.

For investors, the combination of slowing activity and rising input costs presents a challenging environment for the Bank of Canada.