Optimism among Canadians that the value of real estate is increasing pushed consumer sentiment to the highest in three months, telephone polling shows.
The Bloomberg Nanos Canadian Confidence Index rose to 56.2 last week, us from 56.1 in the prior period and the highest since January, the survey found. The 38.5 percent of people expecting higher local home prices was the most this year.
Increasing confidence signals the economy is starting to adjust from last year’s plunge in crude oil prices, which should begin to have positive effects rather than negative in the second half, according to Bank of Canada Governor Stephen Poloz. The Bloomberg-Nanos index remains below a reading of 60 set in late September before the oil crash took hold, and the latest data show Canadians are less sanguine about their personal finances and job security.
“Although Canada’s confidence was significantly driven by a hot energy sector in the past, the tracking suggests that a recovery of confidence in the wake of falling oil prices has not yet occurred,” said Nanos Research Group Chairman Nik Nanos.
Finance Minister Joe Oliver presented a budget on April 21 offering expanded tax-free savings accounts and lower small business taxes while ending seven years of deficits. Oliver delayed his budget into the start of the fiscal year that began April 1 to adjust his figures to lower oil revenues.
“We have been through some trying times, but now our hard work –- the hard work of all Canadians –- is paying off,” Oliver said in his budget speech.
The Nanos poll suggested that more Canadians agree with Oliver and Poloz that the worst may be over. The survey showed 34 percent of those asked said the economy will weaken in the next six months, the least since Jan. 16.
A report Thursday will show whether consumers are picking up the slack again in the world’s 11th largest economy. Statistics Canada publishes gross domestic product for February and economists surveyed by Bloomberg expect a second straight decline of 0.1 percent, following a January decline led in part by retailing.
The share of respondents who say they’re worse off in terms of their personal finances compared with a year earlier rose to 26.2 percent, the most since September. Those who feel at least somewhat insecure about their jobs was 13.2 percent, compared with a 12-month average of 11.9 percent.
Every week, Nanos Research asks Canadians for their views on personal finances, job security, the outlook for the economy and where real estate prices are headed. The survey data is compiled for Bloomberg News.