Weekly poll of consumer sentiment shows that only real estate expectations gained a higher share of positive responses
Lockdown has been tough and reopening of the Canadian economy was always going to result in some kind of rebound in consumer spending.
But is increased spending down to pent-up demand rather than a return to whatever shade of normal we can expect in a COVID-cautious Canada?
As more parts of the economy take nervous steps forward, it appears that sentiment among consumers has stalled in recent weeks, following an initial surge as lockdown measures were relaxed.
The weekly Bloomberg Nanos Canadian Confidence Index was down to 46.11 for the week ending July 10, from 46.22 a week earlier. That puts it below the 47.62 average for the year so far; 2020 has ranged from a high of more than 57 in January to a low near 37 in April.
“Week over week tracking in the Bloomberg Nanos Canadian Confidence Index remained unchanged but still was more positive compared to four weeks ago. With a current score on the 100 point diffusion index of 46, consumer confidence remains net negative,” explained Nanos Research’s chief data scientist Nik Nanos.
Positive responses were down week-over-week on the outlook for the economy over the next 6 months, job security, and personal finances. There was a slight increase for real estate price expectations over the next 6 months.
Finances have worsened
Only 13% of respondents report being better off financially over the past year, near all-time lows, while 37% say their finances have worsened. More than half believe the economy will worsen in the months ahead, although this is down sharply from the 80% who said this in April.
Although sentiment on real estate prices is below pre-pandemic levels, the share of those who think prices will be higher by the end of the year has doubled to 21% since May.
Overall sentiment ticked higher in Quebec and Ontario but slipped elsewhere.
Under 50s were more optimistic than a week ago while older Canadians were less so. Those with the lowest incomes (less than $30K) saw the largest drop in sentiment compared to a week earlier.