Confidence index up in February

 OTTAWA – For the first time in three months, the Conference Board of Canada’s Index of Consumer Confidence registered a slight gain for the month February, thanks mainly to a more optimistic outlook in Ontario, Quebec and British Columbia.

The index, according to the privately-held think tank, rose 3.7 points in February to 83.7. It was set at 100 in 2014.

The Conference Board’s online survey of some 3,000 Canadian adults was conducted between February 1 and 11, 2016.

Authored by Julie Adès, a senior economist in the board’s national forecasting division, the report also noted confidence deteriorated in Atlantic Canada, the Saskatchewan-Manitoba region and Alberta.

The regions
While Adès called the rise in Ontario’s index encouraging, she pointed out “the gain was only enough to partly offset the decline recorded in the previous two months.”

She added that for most of the past year, consumers in Canada’s largest province reported deteriorating sentiments in several areas including current and future finances as well as the major purchases question.

“However, relative to January, the balance of opinion improved on these three questions in February,” she said.

Similarly, Quebec’s index rose in February but, again, not nearly enough to offset the declines recorded in the previous two months.

In Western Canada, B.C. had the best performance as its index rose 3.8 points. “Still, this tepid gain did little to offset the significant drops of the previous two months,” Adès said.

In Alberta, consumer confidence continued to deteriorate in February, reaching a new low that is almost 70 points below its 2014 average.

The Saskatchewan-Manitoba region has also been feeling the effects of weak commodity prices, and its index has been on a downward trend since the end of 2014. February’s was the fourth consecutive decline, and left the regional index barely above the record low it hit in February 2009 – at the of the 2008–2009 recession.

Atlantic Canada’s index fell in February for the third consecutive month, but thanks to jumps last September and November, it is still above its 2014 average.

The questions
“For the third month in a row, survey respondents’ sentiments about their current financial situation worsened,” Adès reported, adding while the share who said they were financially better off now than six months ago increased – from 13.8% to 14.4% – those saying they were worse off rose even more, from 28.2% to 30.6%.

Meanwhile, the national balance of opinion on future finances improved in February. The share of respondents saying they expect to be financially better off six months from now increased from 20.1% to 21.6%. At the same time, the share of respondents who said they expect to be worse off fell from 22.1% to 18.3%. The improvement occurred in all regions.

For a third consecutive month, consumers’ sentiment about future job prospects deteriorated. The share sayings they expect more jobs in their communities in the coming months fell from 8% per cent to 7.9%. At the same time, the share saying they expect fewer jobs increased from 35.8% to 36.5%.

Responses to the major purchase question improved slightly in February relative to January.

“Still the balance of opinion on this question remains highly negative,” Adès said, adding the share saying now is a good time to make a major purchase (house, car or furniture and appliances) rose from 24.3% to 25.3% — thanks mainly to consumers in Ontario and Quebec.

But the share of respondents who said now is a bad time remained relatively unchanged at an elevated 50.3%.