Ipsos Reid

Ipsos Reid

March 21, 2005 06:05 ET

CANADIANS CONFIDENT ABOUT THE CURRENT ECONOMY AND YEAR AHEAD

The Ipsos-Reid Canadian Economic Confidence Index Climbs 3.1 Points To 106.7 Attention: Business/Financial Editor TORONTO, ONTARIO--(CCNMatthews - March 21, 2005) - The latest Ipsos-Reid Economic Confidence Monitor, provided exclusively to the Report on Business section of the Globe and Mail and Report On Business Television (ROBTv), indicates that Canadians continue to be optimistic about the current economy and the year ahead. Today, 78% of Canadians describe the current economy as good, virtually unchanged from the 81% witnessed in November 2004. In addition, 27% think the national economy will "improve" over the next year or so (a slight dip from 34% in November) and another 52% think the economy will "stay the same."

The Canadian Economic Confidence Index developed by Ipsos-Reid has risen 3.1 points from 103.6 in November to 106.7 today. The index functions as a predictor for the Canadian economy. The index is based on six key factors that influence Canadians' expectations of whether the Canadian economy will improve, stay the same or get worse in the next year or so. These factors are: Expectations that one's own economic situation will improve/worsen; job anxiety; likelihood of purchasing a home in the next six months; expectations of change in interest rates in the next six months; and expectations of spending more/less big-ticket items; and on day-to-day spending.

Positive home purchasing intentions and low job anxiety continue to give the Canadian Economic Confidence Index a strong push, slightly more so than in November 2004. Today, 15% of Canadians say they are likely to purchase a new or another home right now (7% "very likely") and, just 17% of Canadians are worried about either themselves or someone in their household losing their job.

An expectation that one's personal economic situation will improve remains a nominally positive attribute. Slightly more than one-third (36%) of Canadians think their personal economic situation will "improve," while only 12% think it will "get worse."

Interest rate predictions remain the most negative factor, but much less so than in November. Today, 50% of Canadians thinks interest rates will "go up" in the next six months, down 18 percentage points from November 2004 (68%). And, 41% believe rates will "remain unchanged," up from 25% in November. Just 6% of Canadians think rates will "go down" (4% in November).

Expectations about everyday purchase intentions and big-ticket spending in the next year continue to soften economic confidence, as they have since August 2002. Three in ten (29%) Canadians say they plan to spend more on big-ticket items such as a car, household appliances, or vacations the next year than they did last year, while the same proportion (27%) says they expect to spend less than they did last year. And, 30% of Canadians say they expect to spend more on things such as groceries, clothing or other personal goods and services than last year, while 13% says they plan to spend less.

These are the findings of an Ipsos-Reid poll conducted from February 25th to February 27th, 2005. For the survey, a representative randomly selected sample of 1000 adult Canadians was interviewed by telephone. With a sample of this size, the results are considered accurate to within ± 3.1 percentage points, 19 times out of 20, of what they would have been had the entire adult Canadian population been polled. The margin of error will be larger within regions and for other sub-groupings of the survey population. These data were weighted to ensure the sample's regional and age/sex composition reflects that of the actual Canadian population according to the 2001 Census data.

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For more information on this news release, please contact:
Jennifer McLeod
Senior Research Manager
Ipsos-Reid Public Affairs
(416) 324-2900

For full report and tabular results, please visit our website at www.ipsos.ca.
News Releases are available at: http://www.ipsos-na.com/news/

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