Canadian Consumer Mood Posts First Increase in Five WeeksGreg Quinn
Canadian consumer confidence rose for the first time in five weeks as opinions about job security and house prices improved.
The Bloomberg Nanos Canadian Confidence Index, a weekly measure of the economic mood of Canadians, advanced to 58.5 in the seven days through Nov. 1 from 57.7 the previous week. The share of people in the survey giving positive responses on home prices rose to 38.6 percent from 38.0 percent, the highest in three months.
“More bullish views on real estate are the most likely to be driving positive movement in Canadian consumer confidence at this time,” said Nik Nanos, chief executive officer at Nanos Research Group in Ottawa.
The housing market remains one of the strongest parts of the economy after years of support from low interest rates and a solid labor market. Bank of Canada Governor Stephen Poloz told lawmakers on Oct. 29 that real estate remains firm even as consumers take steps to curb record debt loads.
Reports this week may show further strength in domestic spending. Statistics Canada will probably report Nov. 6 that building permits rose 6 percent in September, and that employment rose by 11,000 in October two days later, according to surveys of economists by Bloomberg News.
The Nanos survey showed higher confidence in job security, with 65.3 percent of respondents having a positive view, up from 64.4 percent in the last report.
Both components of the index rose last week. The Bloomberg Nanos Canadian Pocketbook Index, based on personal finances and job security, rose to 59.5 from 58.7. The Expectations Index, measuring views on the economy and real-estate prices, increased to 57.5 from 56.7, a five-week high.
“Canadian consumer sentiment stabilized likely due to relief the U.S. fiscal standoff was resolved and rebounded in confidence that Bank of Canada policy will prevent asset deflation in the housing sector,” said Joseph Brusuelas, senior economist at Bloomberg LP in New York.
Finance Minister Jim Flaherty said Oct. 28 that Canada will report a surplus in 2015 that won’t be “tiny,” following an earlier report that the deficit for the year ended March 31 was C$18.9 billion, or C$7 billion ($6.7 billion) less than projected.
Statistics Canada reported Oct. 31 that the economy grew 0.3 percent in August on record oil and natural gas extraction, faster than economist predictions for a 0.1 percent gain.
The Nanos survey showed more optimism about the economy’s prospects, with the share of people saying it would improve rising to 22.1 percent from 20.8 percent. The share of people saying their personal finances had improved over the last year was little changed, at 19.3 percent from 19.2 percent in the last report.
The data in the indexes date to 2008 and 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, 19 times out of 20.