Canadian consumer confidence was little changed at the lowest in a month before reports this week that will provide clues about how the world’s 11th largest economy fared during a harsh winter.
The Bloomberg Nanos Canadian Confidence Index was 58.0 in the week ending March 28, matching the prior reading. Sentiment rose in every region except Ontario, Canada’s most-populous province, where it fell to the lowest since Feb. 21, according to the survey-based measure.
The nation’s economy is showing mixed signals, with strengthening growth tempering a weak jobs market and slow inflation. Gross domestic product expanded 0.5 percent in January after contracting 0.5 percent in December, which was the biggest drop in almost five years, Statistics Canada reported today from Ottawa.
“Weaker external demand, falling commodity prices and ongoing issues with the early stages of household deleveraging are likely dragging down consumer sentiment,” said Joseph Brusuelas, senior economist with Bloomberg LP in New York.
The Ottawa-based statistics agency will report February’s trade-balance on April 3, and March labor-market figures the following day. Employment gains have been negligible on balance for the four months through February.
Economists projected GDP growth of 0.4 percent, and forecast job gains of 22,500, according to median forecasts in separate Bloomberg News surveys through March 29.
Bank of Canada Governor Stephen Poloz said in a March 18 speech in Halifax he can’t rule out an interest-rate cut if the economy worsens.
Growth in the first quarter of this year will be on the “soft side” mostly because of unusually cold weather, Poloz said in the speech.
Consumer sentiment in Ontario dropped to 58.0 from a prior reading of 59.3, the Nanos data showed. Premier Kathleen Wynne, who leads a minority Liberal government in the legislature, may face an election within weeks after police filed court documents alleging her predecessor’s chief of staff committed breach of trust by arranging to delete documents that related to the cancellations of two gas-fired power plants.
Sentiment in Quebec rebounded to 56.6 last week from 56.0 the week before. Confidence in the French-speaking province had dropped from 59.2 on March 7, amid an election that has raised the prospect of a referendum on independence.
Bloomberg Nanos’s confidence index has two sub-indexes: the Pocketbook Index, based on survey responses to questions about personal finances and job security, and the Expectations Index, based on responses on the outlook for the economy and real-estate prices.
The Pocketbook Index fell last week to 59.8 from 60.6 while the Expectations Index climbed to 56.1 from 55.5.
The proportion of survey respondents who said their personal finances are better off over the past year dropped to 19.3 percent,the lowest in more than a month, from 20.7 percent the previous week, according to the Nanos report.
Those who said the economy will strengthen in the next six months rose to 21.1 percent, the highest since January, from 19.5 percent. The share of people who see their jobs as secure fell to 47.8 percent, the lowest reading since Feb. 7, from 49.6 percent the week before.
The percentage of respondents who believe real-estate prices in their neighborhood will increase over the next six months dropped to 37.0, according to the Nanos report. Nik Nanos, chairman of Nanos Research Group, said it’s noteworthy that optimism about real estate declined this month from a high of 39.4 percent on March 7.
Canadian Finance Minister Joe Oliver said last week he will continue to reduce potential risks to taxpayers of a downturn in the housing market after lenders including Bank of Montreal cut some of their mortgage rates.
The Nanos data are based on phone interviews with 1,000 people, using a four-week rolling average of 250 respondents. The results are accurate within 3.1 percentage points, 19 times out of 20.