Household Confidence Edges Up Ahead of Trudeau Benefit Checksby
Nanos Canadian index climbs for second consecutive week
Polling shows optimism on personal finance, housing prices
Canadian consumer sentiment rose for a second week as expectations of government rebates helped lift optimism about personal finances and fewer people expected falling home prices.
The Bloomberg Nanos Canadian Confidence Index climbed to 57.3 in the week ending July 15, from 56.9 previously. The share of people saying their finances improved climbed to a five-week high of 15.5 percent, and those saying things had worsened fell to 25.4 percent from 27 percent.
Family benefit payments will start being delivered in mid-July, one of the main fiscal actions by Prime Minister Justin Trudeau’s Liberal Party this year to boost sluggish growth as the country rebounds from an oil shock. Bank of Canada Governor Stephen Poloz stuck to his message last week that a recovery led by other parts of the economy will ramp up in the second half of the year. Policy makers have also touted government spending on infrastructure projects as boosting output later this year.
“The consensus is for a rebound in Canadian economic activity after the latest shock, with household consumption buoyed in the near term by fiscal programs that will put cash into household pocketbooks, and in the long term by improving employment prospects,” said Robert Lawrie, a Bloomberg economist.
The Nanos polling also showed continued faith in the housing market, even as Poloz and the International Monetary Fund warn that gains in Vancouver and Toronto look unsustainable. The 14.1 percent of people who said local real estate prices will decline in the next six months was the lowest since November.
Confidence overall also remains split along regional lines, with Ontario and British Columbia posting higher readings than the Prairie region that includes the struggling oil hub of Alberta, Nanos Research Group Chairman Nik Nanos said in the report.
Canada’s recovery appears modest, the polling shows. The 44.8 percent of people who saw the economy being about the same in six months is the highest share since last July. The 23.7 percent who were unsure about their job security was the highest since May 2014.
The Bloomberg Nanos Canadian Confidence Index is based on telephone polling with a rolling four-week average of 1,000 respondents. It is considered statistically accurate within 3.1 percentage points, 19 times out of 20, with larger margins of error for regional breakdowns.