The leading indicator posted a solid 0.5% gain in December after growth slowed to 0.4% in October and 0.3% in November, says a Statscan release, yesterday.
Investment demand continued to stimulate manufacturing, while the stock market hit a record high. Two components of household demand fell, the same as in November.
New orders recorded their fourth straight increase. This demand was partly met by lower inventories, raising the ratio of shipments to stocks for the second time in three months. Investment goods continued to lead the way.
Business investment accelerated in the third quarter, and non-residential building permits augur continuing strength as they remained well ahead of the previous year's pace.
The stock market set new records, propelled by energy and mining stocks where prices remained strong. The stock market contributed 0.1 percentage points to overall growth.
The two components that fell in December came from the household sector. A rebound in auto sales was not enough to raise the trend of durable goods sales, which fell for a second straight month.
The housing index retreated for the third month in a row, with the drop in housing starts accelerating while existing home sales backed off from their record highs.
Only furniture and appliance sales continued to sparkle, rising 1.1%. The rising dollar has helped lower prices of household appliances, whose cost has fallen steadily to their lowest level in 20 years, even as the overall Consumer Price Index nearly doubled over these two decades.
These goods increasingly came from China, which supplied about one-third of our imports of these products in 2005 (two-thirds of the growth last year).
The US leading indicator improved by another 0.2%. While growth has broadened since last August, most of the increase was driven by falling claims for unemployment insurance, which have returned to their level before Hurricane Katrina hit.
-Ltd..jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Thermore (Far East) Ltd.")
.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Telangana State Industrial Infrastructure Corporation Limited (TSllC Ltd)")
.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Taiwan Textile Federation (TTF)")
