INDUSTRY PULSE: Big shipment gains pulls down the inventory-to-shipment ratio
OTTAWA, Ont. — January’s strong rebound in shipments largely contributed to the downward movement of the inventory-to-shipment ratio to 1.24 from December’s recent high of 1.26.
This marks the lowest ratio since September (1.23), according to Statistics Canada. The ratio began to trend upwards in the second half of 2004 as the manufacturing sector showed signs of weakening.
The inventory-to-shipment ratio is a key measure of the time, in months, that would be required in order to exhaust inventories if shipments were to remain at their current level.
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