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Consumer Confidence Falls on Economic Concerns
Last week, the sentiment of Canadian consumers dropped as optimism regarding the job security and economic outlook which was shown by a survey data. Ontario’s consumer confidence surged to the top since 2009 while the strengthening recovery of the United States demands for some manufactured goods from the most populous province of Canada. It has been stated by the Bloomberg Nanos Canadian Confidence Index.
This year, the survey-based index got an average of 58.9. The gauge of optimism regarding the real estate costs has increased while the sentiments regarding personal finances have slightly changed. The economic data provided mixed signals regarding the eleventh biggest economy of the world’s health. It can consume about 3 quarters of the exports of Canada.
Canada had posted the surprise trade deficit last August which was reported by the government statistics agency last October 3. The current trading has reflected a divergent performance of the economy. The Canadian dollar touched about C$ 1.1271 against the US counterpart in the past week in Toronto. This was stated as the lowest amount since March.
Statistics Canada will be releasing the employment report for the month of September on the 10th of October. Carolyn Wilkins, the Bank of Canada Senior Deputy Governor, stated in an interview that the slow growth of employment is an indication that slack persists in its economy. It then suggests that lower interest rate remains essential.
The central bank reported that business investment and exports should be acquired from consumers who spend as growth engines prior to reaching the full output of the economy. Nik Nanos, Nanos Research Group Chairman stated that the positive sentiment of economy is continually driven by the western provinces of the country and Ontario. He also said that the index score for the Prairies, Alberta and British Columbia remains close to the 2014 high while Quebec’s consumer confidence has been noticeably lower on its twelve-month high.
The gauge of Nanos got 2 sub indexes which are the Pocketbook Index and the Expectations Index. The Pocketbook Index has been derived from the responses regarding personal finances as well as job security. On the other hand, the Expectations Index has been taken from the responses regarding the outlook for national economy and the real estate. Last week, the Pocketbook Index has declined from 60.8 to 60.6 while the Expectations Index declined from 59.2 to 58.7.
The Bloomberg Nanos Consumer Confidence Index has been taken from the weekly polling of phone interviews with one thousand individuals. It makes use of a 4-week rolling at an average of two hundred fifty respondents.
Among the pocketbook indicators, individuals who claimed that their job has been secured changed from 66.9 percent to 68.8 percent. The respondents who said that they are financially stable last year increased from 19.3 percent to 19.7 percent. Their 2014 average has been 19.6 percent.
This week reveals that consumer confidence has been short-lived. Individuals who were surveyed felt that economy had not been perceived as positive, particularly with the surprise trade deficit.
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