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Higher oil prices boost Prairie consumer confidence to pre-recession levels

oil prices

Oil prices have increased consumer confidence in resource rich prairie provinces.

Expectations are Canada will be second only to the U.S. for economic growth in 2018

The latest Bloomberg Nanos Canadian Confidence Index hit an eight year high as consumer sentiment in the Prairie provinces ramps up, according to a press release.

“After being in the doldrums in terms of consumer sentiment, Canadians sentiment in the energy rich Prairie provinces has shown a noticeable rise,” said Nanos Research Group chair Nik Nanos. “The Prairie provinces hit a level not seen since 2014.”

The BNCCI, a composite of a weekly measure of financial health and economic expectations, registered at 62.17 compared with last week’s 61.21. The twelve month high stands at 62.17.

Oil prices breached $60 for the first time in a year and a half, a positive sign for the oil-dependent region and perhaps another signal that a period of normalcy is underway,” said Bloomberg economist Robert Lawrie.

“Indications are that Canada will have been the fastest growing among the major economies in 2017, with expectations that Canada and Germany will be second only to the projected U.S. growth in 2018-19, according to a Bloomberg survey of economic analysts.”

The Bloomberg Nanos Pocketbook Index is based on survey responses to questions on personal finances and job security. This sub-indice was at 63.39 this week compared to 62.10 the previous week.

“The increase in economic activity has resulted in a 5.9 per cent unemployment rate and 12 months of positive wage growth for Canadian households that is pushing consumer sentiment toward record levels for this cycle,” said Lawrie.

The Bloomberg Nanos Expectations Index, based on surveys for the outlook for the economy and real estate prices, was at 60.95 this week and averaged 58.59 this year.

The data is based on random telephone interviews with 1,000 Canadian consumers (land- and cell-lines), using a four week rolling average of 250 respondents each week, 18 years of age and over, and is accurate 3.1 percentage points, plus or minus, 19 times out of 20. The views of 1,000 respondents are compiled into a diffusion index from 0 to 100. A score of 50 on the diffusion index indicates that positive and negative views are a wash while scores above 50 suggest net positive views, while those below 50 suggest net negative views in terms of the economic mood of Canadians.

 

Posted in: Canada

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