Canadian consumer confidence recorded its sharpest weekly decline since the depths of the
pandemic, with inflation and a deteriorating outlook for the housing market dampening
sentiment.
The Bloomberg Nanos Canadian Confidence Index, a measure of sentiment based on weekly
polling, dropped to 54.3 last week, the lowest reading since December 2020. The 1.8-point
decline is the largest one-week slump in the index since April 2020, which was the start of the
global pandemic.
The numbers suggest that a combination of rising consumer prices, higher interest rates, and a
weakened housing market are starting to weigh on Canadians.
The country’s housing market is quickly showing signs of a reversal. About 55% of Canadians
say they expect home prices to continue increasing, down from 59% last week and as high as
64% last month. Even with the decline, however, housing price expectations remain above
historical averages.
Each week, Nanos Research surveys 250 Canadians for their views on personal finances, job
security, the economy and real-estate prices. The confidence index represents a rolling four-
week average of about 1,000 responses.
The index hit an all-time high last July but has been falling as the initial optimism around
vaccines and the economic reopening has faded. Sentiment currently sits below historical
averages.
People are particularly concerned about their pocketbooks. About 39% of people surveyed said
their personal finances have worsened over the past year, near the highest level since the early
days of the pandemic.
The survey data showed pessimists on the economic outlook outnumber optimists by almost a
three-to-one ratio: 50% of respondents expect the economy to weaken and only 18% predict it
will be stronger a year from now.
