Canadian consumer sentiment fell last week, led by respondents in the west and as feelings of job security declined, according to the Bloomberg Nanos Canadian Confidence Index.
The weekly measure of the economic mood of Canadians fell to 58.9 in the period ended Nov. 29, from a two-month high of 59.4 the previous week. The share of respondents who described their job as secure dropped to 66.6 percent, from 69.9 percent in September. Those who say their jobs aren’t secure rose to 14.2 percent, the highest since June.
“Economic imbalances in the Canadian economy persist,” said Joseph Brusuelas, senior economist at Bloomberg LP in New York. “Households will likely remain cautious in terms of assessing their own finances, as well as the broader economic condition of the economy until those problems ease.”
Brusuelas pointed to a “noticeable slowdown” in consumer spending in the third quarter. Retail (CARSXASC) purchases excluding motor vehicle and parts were little changed in September, lagging economist forecasts, Statistics Canada said Nov. 22. Canadian household spending rose at a 2.2 percent annualized pace in the third quarter after climbing at a 3.6 percent rate in the three months prior, the agency said last week.
The employment picture has been mixed in Canada. Statistics Canada reported Nov. 8 the economy created jobs for the third straight month and the jobless rate held steady at 6.9 percent, the lowest since 2008. At the same time, the average pace of monthly job gains this year, at 12,600, is half last year’s pace.
Wage growth has also slowed. Average hourly wages of permanent employees rose 1.7 percent in October from a year earlier, compared with an average 3 percent over the past decade.
Statistics Canada will release jobs data for November on Dec. 6, with 18 economists surveyed by Bloomberg through today forecasting an increase of 12,500 in employment.
In Canada’s three prairie provinces, which rely on natural resources such as crude oil and potash for growth, confidence is ebbing along with prices. Sentiment in Alberta, Saskatchewan and Manitoba fell for a third week to 62.9 from 63.1. The measure was as high as 67.4 in September.
West Texas Intermediate crude lost 3.8 percent in November and has dropped for three months, the longest slide since January 2009. Western Canada Select Oil has declined 31 percent since touching a 2013-high on July 18.
While falling last week, confidence in Ontario has outpaced western provinces over the past month, where almost half of full-time Canadian manufacturing jobs are located. Sentiment in Canada’s most-populous province rose to the highest since March 2010 two weeks ago before slipping to 60.1 last week. Factory output rose in the third quarter by the most since the end of 2011, Statistics Canada reported Nov. 29.
Bloomberg Nanos’s confidence index has two sub-indexes: The Pocketbook Index, based on survey responses to questions about personal finances and job security, fell to 60.3 from 61.2. The Expectations Index, based on surveys about the outlook for the economy and real estate prices, fell to 57.5 from 57.7, according to the Nanos report.
The data are based on phone interviews with 1,000 people, using a four-week rolling average of 250 respondents. The results are accurate to within 3.1 percentage points.
The share of Canadians who say they’re better off financially fell to 21.5 percent from 22.4 percent the previous week, while those who say they are worse off increased to 23.9 percent from 23.1 percent.
Respondents who predicted an increase in home values in their neighborhood rose to 40 percent, the most since March 2012, according to the Nanos polling.
“As we enter the final month of the year, the index remains near the upper range of positive confidence in the Canadian economy in 2013,” said Nik Nanos, head of Ottawa-based Nanos Research Group. “Real estate remains a key positive consumer sentiment driver in Canada.”
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