Release Explanation: Measures the total value of sales at the manufacturing level. A rising trend has a positive effect on the nation's currency because increased sales at the wholesale level are a good indication that there is high consumer demand at the retail level.

Trade Desk Thoughts: According to Statistics Cananda, manufacturing sales decreased 5.4% to $41.7 billion in January, falling to the lowest level in almost 10 years. Motor vehicle and motor vehicle parts industries, particularly in Ontario, reported record decreases during the month. Excluding motor vehicles and parts and accessories, manufacturing sales decreased a more moderate 1.2% compared with December.

Constant dollar manufacturing sales, which are measured in 2002 prices, fell 6.4% to $38.1 billion in January. This was the sharpest decrease in constant dollar sales since the current series started in 1997.

At the industry level, sales in 14 of 21 manufacturing industries decreased in January, accounting for about three-fifths of total sales.

The transportation equipment industry reported its largest monthly decline on record, falling 27.3% in January. Most of the decline was due to lower sales by motor vehicle (-46.3%) and motor vehicle parts manufacturers (-27.1%). Both sectors were faced with severe market downturns, which resulted in extended closures and slowdowns at numerous plants during the month.

Primary metal manufacturers also reported lower sales in January. Sales fell 10.5% in January, following decreases of 13.9% in December and 19.1% in November. Primary metal manufacturers have seen prices decrease steadily since August 2008, and the recent declines in sales have been exacerbated by weakening global demand.

Forex Technical Reaction: Crude futures were recently trading 25 cents higher on the day but the cad (USD/CAD) was hitting its highest level of the day.