The Bank of Canada says business and consumer sentiment improved during the first quarter of the year, despite higher interest rates still putting a drag on the economy.
The central bank released its business outlook and consumer expectations surveys Monday, which showed increased optimism as people expect interest rate cuts are nearing.
Although firms still reported weak demand, indicators of business conditions, sales outlook and employment intentions improved after several quarters of decline.
“In the wake of weak past sales growth, expectations for improved sales are supported by population growth, efforts to enter new markets or develop new products and expectations that interest rates will decline over the next 12 months,” the Bank of Canada said.
Meanwhile, nearly two-thirds of Canadian consumers are cutting or postponing spending due to high inflation and interest rates.
Nevertheless, consumers are becoming less pessimistic about where the economy is headed as they expect interest rates to fall.
“Although weak, consumer sentiment improved this quarter, with people expecting lower interest rates,” the Bank of Canada said. “As a result, consumers are less pessimistic about the future of the economy and their financial situation, and fewer think they will need to further cut or postpone spending.”
Workers also continue to be optimistic about the job market and expect strong wage growth, despite signs of the labour market loosening.
After a historic run-up in inflation post-pandemic, the Bank of Canada responded with rapid interest rate hikes that brought up its key interest rate target to five per cent – the highest it’s been since 2001.
Forecasters widely expect the central bank to begin lower its policy rate around the middle of the year as inflation continues to fall and economic growth remains weak.
Canada’s annual inflation rate fell to 2.8 per cent in February.
The central bank surveys found that while businesses’ expectations for inflation in the near term continue to decline, consumers’ expectations have remained essentially unchanged.
“Consumers link their perceptions of slowing inflation with their own experiences of price changes for frequently purchased items, such as food and gas,” the central bank said.
The Bank of Canada is scheduled to make its next interest rate announcement on April 10.
This report by The Canadian Press was first published April 1, 2024.
TORONTO – Strength in the base metal and technology sectors helped Canada’s main stock index gain almost 100 points on Friday, while U.S. stock markets also climbed higher.
The S&P/TSX composite index closed up 93.51 points at 23,568.65.
In New York, the Dow Jones industrial average was up 297.01 points at 41,393.78. The S&P 500 index was up 30.26 points at 5,626.02, while the Nasdaq composite was up 114.30 points at 17,683.98.
The Canadian dollar traded for 73.61 cents US compared with 73.58 cents US on Thursday.
The October crude oil contract was down 32 cents at US$68.65 per barrel and the October natural gas contract was down five cents at US$2.31 per mmBTU.
The December gold contract was up US$30.10 at US$2,610.70 an ounce and the December copper contract was up four cents US$4.24 a pound.
This report by The Canadian Press was first published Sept. 13, 2024.
OTTAWA – Statistics Canada says wholesale sales, excluding petroleum, petroleum products, and other hydrocarbons and excluding oilseed and grain, rose 0.4 per cent to $82.7 billion in July.
The increase came as sales in the miscellaneous subsector gained three per cent to reach $10.5 billion in July, helped by strength in the agriculture supplies industry group, which rose 9.2 per cent.
The food, beverage and tobacco subsector added 1.7 per cent to total $15 billion in July.
The personal and household goods subsector fell 2.5 per cent to $12.1 billion.
In volume terms, overall wholesale sales rose 0.5 per cent in July.
Statistics Canada started including oilseed and grain as well as the petroleum and petroleum products subsector as part of wholesale trade last year, but is excluding the data from monthly analysis until there is enough historical data.
This report by The Canadian Press was first published Sept. 13, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in the base metal and energy sectors, while U.S. stock markets were mixed.
The S&P/TSX composite index was up 172.18 points at 23,383.35.
In New York, the Dow Jones industrial average was down 34.99 points at 40,826.72. The S&P 500 index was up 10.56 points at 5,564.69, while the Nasdaq composite was up 74.84 points at 17,470.37.
The Canadian dollar traded for 73.55 cents US compared with 73.59 cents US on Wednesday.
The October crude oil contract was up $2.00 at US$69.31 per barrel and the October natural gas contract was up five cents at US$2.32 per mmBTU.
The December gold contract was up US$40.00 at US$2,582.40 an ounce and the December copper contract was up six cents at US$4.20 a pound.
This report by The Canadian Press was first published Sept. 12, 2024.
