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2026-04-06 21:33:29
[Canadian Services Shrunk for Fifth Consecutive Month as War Delays Customer Decisions; Input Price Index Soars to 62.3] ⑴ S&P Global data released Monday showed that Canada's services business activity index rose to 47.2 in March, the highest in five months, but remained below the 50-point threshold for the fifth consecutive month, indicating a continued deterioration in service sector activity. Uncertainty stemming from the Middle East war led to a decline in new business, while rising fuel costs pushed up operating expenses. ⑵ The head of economics at S&P Global Market Intelligence stated that the impact of the Middle East war exacerbated uncertainty, delaying customer decisions. Although businesses believed a swift resolution to the conflict would lead to a rebound in activity, the new business indicator remained in contraction territory for the 16th consecutive month, rising slightly to 47.7 in February from 46.9. ⑶ Businesses reported a significant increase in operating expenses, primarily driven by rising fuel and transportation costs. The input price index jumped from 57.1 in February to 62.3, the highest level since June of last year, while the future activity index rose to a six-month high of 61.9. (4) The Canadian economy was also severely impacted by U.S. industry-specific tariffs and uncertain negotiations surrounding the UMC, which is due for review by July 1. The S&P Global Canada Composite PMI output index rose slightly to 47.6 in March from 47.1, marking the fifth consecutive month below 50.
