The S&P Global Canada Manufacturing PMI rose to 48.3 in August 2025 from 46.1 in the previous month, but continued to reflect a contraction in the Canadian private-sector factory activity. It was the seventh consecutive month of decline in manufacturing, pressured by the series of tariffs slapped by the United States on Canadian goods and domestic retaliatory levies. Marked contractions took place both for new orders and output, albeit at a noticeably slower pace than those observed in July, amid lower demand from Canada's largest trading partner. The demand for capacity drove firms to reduce staffing levels for the seventh straight month, though the pace of job losses eased to the weakest rate since April. Still, input inflation rose to its highest level in three months, keeping cost pressures elevated. Looking ahead, firms continued to cite uncertain outlooks due to volatile policy changes, although confidence improved to a seven-month high and remained well below trend.