Economy

Canadians’ mood about their finances improving: Maru poll

Published

1 year ago

May 9, 2023

More Canadians said they believed the national economy would strengthen over the next 60 days, according to the Maru poll. Photo by Peter J. Thompson/National Post

Canadians appeared to reach for some optimism regarding the economy and their personal situations based on the most recent results of a survey that tracks how they feel about their financial prospects.

Twelve of the 16 measures used to create the Maru Household Outlook Index (MHOI) improved in the latest version, released on May 9, said Maru Public Opinion, the creator of the index.

That had Maru wondering if usually glum survey participants had finally found a “spring in their step” about the economy.

The changes cropped up in the macro and the micro and represented cautious baby steps as Canadians perhaps hope that the worst of inflation — at 4.3 per cent after accelerating to 8.1 per cent in June 2022 — and rising interest rates are over.

Among the improvements cited by Maru as evidence of possibly brighter days, 41 per cent of Canadians said they believed the national economy would strengthen over the next 60 days, a six percentage point increase from 35 per cent in March. Maru authors said in a press release that it was the best result since July 2022. Nonetheless, 59 per cent of respondents did not share the sentiment.

More people also agreed that the economy is moving in the right direction — 39 per cent in April compared with 34 per cent. Still, a majority (61 per cent) said the state of the economy is headed in the wrong direction.

People’s pocketbooks also appeared to be a little less stretched.

Fewer Canadians (48 per cent) said they would worry about their personal finances over the coming 60 days compared with just over half (51 per cent) in March. Also, the number of people who said they would struggle to make ends meet also fell in April to 34 per cent from 37 per cent in March. Further, more respondents, 59 per cent, indicated that over the next two months they expected to have enough personal savings, up from 55 per cent in March.

“It may be a small mercy as fewer Canadians think their financial position is worse off than it was last month,” the Maru authors said.

Also, the number of people who said they would invest in financial markets rose to 32 per cent in April from 27 per cent in March.

Still, Maru said the nation is in a “funk.”

The MHOI rose to 85 in April from 83 in March, which was its lowest reading since the index was started by Maru Public Opinion in 2021. April’s reading was nonetheless well off its July 2021 high when it registered 107.

The base number for the index is 100. A result above 100 indicates optimism and below, pessimism. Maru compiles its household index each month by asking a panel of about 1,500 people a series of questions about the economy’s prospects over the next 60 days.

If Canadians’ finances have improved at the margins, their longer-term prospects took a hit.

The share of Canadians able to save for their retirement was at 44 per cent in April. When the index began, that measure stood at 66 per cent.

“The question is whether the current upswing is a burst or just a bubble with the increasingly negative assessment since December 2022 having been arrested with a more positive trajectory ahead, or is it just a temporary burst of vigour?” Maru said.

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Economy

Energy stocks help lift S&P/TSX composite, U.S. stock markets also up

Published

22 hours ago

September 17, 2024

Anne Joseph

TORONTO – Canada’s main stock index was higher in late-morning trading, helped by strength in energy stocks, while U.S. stock markets also moved up.

The S&P/TSX composite index was up 34.91 points at 23,736.98.

In New York, the Dow Jones industrial average was up 178.05 points at 41,800.13. The S&P 500 index was up 28.38 points at 5,661.47, while the Nasdaq composite was up 133.17 points at 17,725.30.

The Canadian dollar traded for 73.56 cents US compared with 73.57 cents US on Monday.

The November crude oil contract was up 68 cents at US$69.70 per barrel and the October natural gas contract was up three cents at US$2.40 per mmBTU.

The December gold contract was down US$7.80 at US$2,601.10 an ounce and the December copper contract was up a penny at US$4.28 a pound.

This report by The Canadian Press was first published Sept. 17, 2024.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)

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Economy

Canada’s inflation rate hits 2% target, reaches lowest level in more than three years

Published

23 hours ago

September 17, 2024

Anne Joseph

OTTAWA – Canada’s inflation rate fell to two per cent last month, finally hitting the Bank of Canada’s target after a tumultuous battle with skyrocketing price growth.

The annual inflation rate fell from 2.5 per cent in July to reach the lowest level since February 2021.

Statistics Canada’s consumer price index report on Tuesday attributed the slowdown in part to lower gasoline prices.

Clothing and footwear prices also decreased on a month-over-month basis, marking the first decline in the month of August since 1971 as retailers offered larger discounts to entice shoppers amid slowing demand.

The Bank of Canada’s preferred core measures of inflation, which strip out volatility in prices, also edged down in August.

The marked slowdown in price growth last month was steeper than the 2.1 per cent annual increase forecasters were expecting ahead of Tuesday’s release and will likely spark speculation of a larger interest rate cut next month from the Bank of Canada.

“Inflation remains unthreatening and the Bank of Canada should now focus on trying to stimulate the economy and halting the upward climb in the unemployment rate,” wrote CIBC senior economist Andrew Grantham.

Benjamin Reitzes, managing director of Canadian rates and macro strategist at BMO, said Tuesday’s figures “tilt the scales” slightly in favour of more aggressive cuts, though he noted the Bank of Canada will have one more inflation reading before its October rate announcement.

“If we get another big downside surprise, calls for a 50 basis-point cut will only grow louder,” wrote Reitzes in a client note.

The central bank began rapidly hiking interest rates in March 2022 in response to runaway inflation, which peaked at a whopping 8.1 per cent that summer.

The central bank increased its key lending rate to five per cent and held it at that level until June 2024, when it delivered its first rate cut in four years.

A combination of recovered global supply chains and high interest rates have helped cool price growth in Canada and around the world.

Bank of Canada governor Tiff Macklem recently signalled that the central bank is ready to increase the size of its interest rate cuts, if inflation or the economy slow by more than expected.

Its key lending rate currently stands at 4.25 per cent.

CIBC is forecasting the central bank will cut its key rate by two percentage points between now and the middle of next year.

The U.S. Federal Reserve is also expected on Wednesday to deliver its first interest rate cut in four years.

This report by The Canadian Press was first published Sept. 17, 2024.

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Economy

Federal money and sales taxes help pump up New Brunswick budget surplus

Published

2 days ago

September 16, 2024

Anne Joseph

FREDERICTON – New Brunswick‘s finance minister says the province recorded a surplus of $500.8 million for the fiscal year that ended in March.

Ernie Steeves says the amount — more than 10 times higher than the province’s original $40.3-million budget projection for the 2023-24 fiscal year — was largely the result of a strong economy and population growth.

The report of a big surplus comes as the province prepares for an election campaign, which will officially start on Thursday and end with a vote on Oct. 21.

Steeves says growth of the surplus was fed by revenue from the Harmonized Sales Tax and federal money, especially for health-care funding.

Progressive Conservative Premier Blaine Higgs has promised to reduce the HST by two percentage points to 13 per cent if the party is elected to govern next month.

Meanwhile, the province’s net debt, according to the audited consolidated financial statements, has dropped from $12.3 billion in 2022-23 to $11.8 billion in the most recent fiscal year.

Liberal critic René Legacy says having a stronger balance sheet does not eliminate issues in health care, housing and education.

This report by The Canadian Press was first published Sept. 16, 2024.

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