Slump in Oil-Rich Prairies Drives Down Canada Consumer Sentimentby
Economic expectations in Canada’s resource-rich Prairies saw their biggest one-week drop since the depths of the oil-price collapse nearly two years ago, dragging down overall Canada consumer sentiment, telephone polling shows.
The national Bloomberg Nanos Canadian Confidence Index fell to 56.4 in the week ending Oct. 21, from 56.8 a week earlier, due to a decline in the expectations sub-index that tracks sentiment on real estate and the overall Canada economy.
The expectations sub-index dropped most sharply in the Prairies, to 38.7 from 43.7, the biggest one-week decline since early 2015 when the impact of collapsing crude prices was taking hold in Alberta’s vast oil sands. Expectations were little changed in every other Canada region.
The polling comes at a time of uncertainty for Canada’s resource provinces, which were the country’s economic engine before the commodities slump. Alberta Premier Rachel Notley warned last week of a grim fiscal outlook, while Saskatchewan Premier Brad Wall is fighting Prime Minister Justin Trudeau over a push to create a minimum national price on carbon.
Nationally, the share of those expecting the economy to contract in the next six months rose to 25.3 percent, from 24.3 percent a week earlier. Those expecting the economy to grow was little changed, while the share of those expecting no change fell.
The share of those expecting real estate values to decline over the next six months rose to 16.5 percent, from 13.6 percent a week earlier. Those expecting prices to increase fell to 38.6 percent from 39 percent a week earlier.
While economic expectations sagged, consumers reported an increase in job security. The share of those who say their employment is at least somewhat secure rose to 67.6 percent from 66.7 percent a week earlier.
The Bloomberg Nanos Canadian Confidence Index is based on a rolling four-week average of telephone polling with 1,000 respondents. It’s considered accurate within 3.1 percentage points, 19 times out of 20.