By Paul Vieira


OTTAWA--Canadian factory shipments rose in October by a faster-than-expected pace, on a strong demand for petroleum and coal products.

The factory-sales figures, along with other data, have some analysts believing the economy might be in better shape than the Bank of Canada has suggested.

Manufacturing sales jumped 2.1% in October from the month before to a seasonally adjusted 70.8 billion Canadian dollars, the equivalent of about $49.8 billion, Statistics Canada said Friday.

The result was stronger than the data agency's advance estimate of a 1.3% increase in October factory sales, and represented the fastest month-over-month gain in nearly two years.

In another data release Friday, Statistics Canada said wholesale transactions, excluding petroleum and associated products, rose 1% in October, or double its previous expectation.

"The upside surprises to both manufacturing and wholesale sales in October supports our view that the near-term economic outlook is now better than the Bank of Canada seems to think," said Stephen Brown, economist at forecasting firm Capital Economics.

Brown added Friday's data point to an improving economic outlook as rate cuts delivered through 2024 begin to feed through the economy. The Bank of Canada cut its benchmark rate for the fifth consecutive time this week, by a hefty half-percentage point. At 3.25%, the central bank's policy rate is now 1.75 percentage points below where it began 2024.

In volume, or price-adjusted, terms, Canadian factory sales rose by a slower 1.4% in October.

Statistics Canada said sales in the petroleum and coal product subsector jumped 15.9% to C$8.2 billion in October, on higher volumes.

Meanwhile, sales of motor vehicles reached their highest level in six months, rising 5.5% in October to C$4.6 billion.


Write to Paul Vieira at paul.vieira@wsj.com


(END) Dow Jones Newswires

12-13-24 0947ET