Global Growth Malaise Seeps Into Canadian Consumer Confidence
Canadian consumer confidence dropped for a second month as global growth concerns spill over into household sentiment.
The Bloomberg Nanos Canadian Confidence Index, a composite gauge based on weekly telephone polling, ended November at 54.8, the lowest month-end reading since January and well below historical averages.
The last two months have seen a dramatic turnaround in confidence, even as financial markets rebounded and speculation emerged the U.S. and China are moving closer to a trade deal. Decelerating growth in Canada along with a divisive federal election that left parliament fragmented and stoked regional tensions may have the country’s consumers on edge.
A separate survey, for example, found only 22% of Canadians showed strong confidence in Prime Minister Justin Trudeau’s ability to create conditions for economic prosperity.
Every week, Nanos Research asks 250 Canadians for their views on personal finances, job security, the outlook for the economy and where real estate prices are headed. Bloomberg publishes four-week rolling averages of the 1,000 telephone responses.
The survey produced deteriorating scores for all four questions, with the most surprising result in the job security category. Only 58.9% of Canadians described their position as at least somewhat secure at the end of November, the lowest reading in more than six years and down from as high as 72% in early March. This is a bit of a puzzle, given Canada’s jobless rate has been hovering near four-decade lows.
Canadians’ have also become less confident over the past month about their personal finances, the health of the Canadian economy and the prospect for real estate prices.
- Regionally, the decline was broad-based west of Quebec. Respondents in Ontario, the prairies provinces and British Columbia all reported weaker sentiment. The starkest declines were in oil producing Alberta and Saskatchewan
- Only 14.8% of Canadians said they were better off financially over the past year, near the lowest level since 2016
- The share of Canadians who believe the economy will strengthen over the next six months was at 13.3% at the end of November, versus a historical average of 21% for this question
- Sentiment around real estate prices has also weakened slightly over the past couple months, but remains within average ranges
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