Concerns about the future of the Canadian economy’s long-term prospects are stifling chances of a sustained, consumer-led recovery, according to TNS Canadian Facts.
The overall consumer confidence index fell 4.5 points to 94.4 in July from 98.9 in June, suggesting an intensified concern about the economy in the past month.
The expectations index, which measures consumers’ estimation of the economy, household income and employment over the next six months fell for a fourth consecutive month. It declined 1.6 points to 104.2, a level not seen since July 2009. Since March, the index has fallen 7.7 points.
The buy index, which measures the degree people think the current environment is a good time to make a major purchase, plummeted 9.3 points to 87.7. The last time the index was this low was in January 2009, in the midst of the global financial crisis.
Michael Antecol, vice-president of TNS Canada, noted the undercurrent of bad economic news, combined with the HST in B.C. and Ontario, and other taxes are contributing to the drop in consumer confidence.
“It’s not that there hasn’t been good short-term economic news lately,” said Antecol, “But until positive short-term developments inspire future-oriented confidence, the chance of a sustained economic recovery will keep receding into the horizon.”