Consumer Confidence Shows Signs of Life

According to Harris/Decima Senior Vice-President Jeff Walker, “Some Canadians appear to be seeing light at the end of the economic tunnel, as both the 1 year and 5 year outlook results have improved this quarter”. “The roller-coaster ride may not be over yet, but the data suggests many feel that we have hit bottom, and will gradually move upward from here”.

“Restored consumer confidence is an important factor in any potential economic recovery”, said Debbie Ammeter, Vice-President of Advanced Financial Planning at Investors Group. “It is interesting to note that Canadians seem to recognize that things could be difficult for most of this year but yet there appears to be more who believe that they will be better off a year from now.”

The overall index of Consumer Confidence in the economy rose in the period from December to February to 67.0, the highest the index has been since August 2008. In the United States, the index did not see the same bounce as in Canada, inching only slightly upward to 61.2

The most significant jump in optimism was on the question of how Canadians felt they’d be doing financially a year from now. Twice as many people feel they’ll be better off than worse off (27%-13%). This is an improvement from December results when 20% felt they’d be better off, while 18% felt they’d be worse off.

Canadians are also more amenable to making a major purchase. In December, 35% thought it was a good time to make a major purchase, while half (50%) thought it was a bad time. Today opinion is virtually even, with 41% feeling now is a good time to make a major purchase and 43% feeling it is a bad time to do so.

Pessimism about the economic outlook for the coming year decreased slightly. While a majority (59%) still foresee bad times for the economy in the coming year, this was down from the 64% who answered in kind in the December survey. One-in-ten (10%) see good times ahead for the economy in the next 12 months.

The number of Canadians who say they are worse off today than they were last year, remained relatively steady at 27%, down a point from the December survey. Once again, people are far more likely to say they are doing about the same financially as they were last year (57%). 13% feel they are better off financially compared to a year ago, relatively unchanged since December.

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