Canada April S&P Global services PMI 41.5 vs 41.2 prior

In March this index fell to 41.2 from 46.6, which was the lowest reading since June 2020. It bounced slightly here but that's hardly reassuring.

• Composite index 41.7 vs 42.0
• Job losses were recorded for a fourth successive month
• A lack of present incoming new work meant firms were generally willing to let employees leave without replacing them
• Firms chose on average to reduce their selling prices for the first time in nearly four years
• Panellists reported that sales volumes had continued to deteriorate
• Backlogs of work were nonetheless reduced markedly again as capacity remained more than sufficient to deal with current workloads

This sure sounds like a recession and that the BOC needs to get ahead of the curve. This report doesn't get a great deal of attention in the market but maybe it should.

Paul Smith, Economics Director at S&P Global Market Intelligence, said:

“Canada’s service sector economy faced another challenging month, with activity declining steeply and new business volumes again down sharply. Firms again linked these weak trends to widespread economic and political uncertainty, in turn linked to trade policies and, at the time of survey data collection, the general election.

“Service providers are hopeful that a more stable business environment will have emerged in a year’s time, but presently, given the lack of new work and excess capacity at units, job losses were again reported. Moreover, adding to the woes of service providers, firms felt compelled to reduce their output charges for the first time in over four years – despite input price inflation remaining elevated as suppliers were again reported to be reevaluating their list prices.”