© Reuters. FILE PHOTO: A man checks an apple while shopping at a grocery store in Toronto, Ontario, Canada November 22, 2022. REUTERS/Carlos OsorioTORONTO - Contraction in Canada's service sector deepened in October as inflation and higher borrowing costs weighed on new business activity, data from the first public release of the S&P Global Canada services PMI showed on Friday.
The data"showed that the nation's vast services economy, the key contributor to overall economic output in Canada, remained mired in contraction territory during October," Paul Smith, economics director at S&P Global Market Intelligence, said in a statement. The new business index fell to 47.6 from 48.7 in September, pressured by increases in the cost of living and interest rates.
The employment index dipped but remained above the 50.0 no-change mark for a second straight month as firms made efforts to fill long-held vacancies with suitably qualified staff. The need to pay higher wages added to cost pressures.The S&P Global Canada Composite PMI Output Index, which captures manufacturing as well as service sector activity, was also at its lowest level since August 2022, falling to 46.7 from 47.4 in September.