Canadian economy on the wrong track, survey finds

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Despite forecasts of stronger-than-expected growth in early 2024, a majority of Canadians simply don't like where the economy is headed, according to the latest results of a long-running survey of the financial outlook for Canadians. homes.

Two-thirds of Canadians believe the economy is headed in the wrong direction, Maru Public Opinion found in its March survey, and negative opinion is widespread in most regions of the country.

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Albertans were more concerned about the trajectory of the economy. Nearly three-quarters said they viewed the economy negatively, an increase of seven percentage points from February, closely followed by Ontarians at 70 per cent, a jump of six percentage points. Just over two-thirds of Quebecers thought the economy was going in the wrong direction, as did 55 per cent of British Columbians.

The latest results also reveal that many Canadians do not expect either the national economy (61 percent) or their local economy (59 percent) to improve in the next two months. Both results increased slightly compared to February.

“The findings reveal a public deeply disheartened about the state of the national economy, burdened by acute personal financial pressures and harboring deepening insecurities about the economic trajectory of themselves and the nation,” said John Wright, executive vice president of Maru . in a news release Thursday. “Negative sentiment is pervasive across multiple dimensions, underscoring the formidable headwinds facing both consumer confidence and the country's broader economic outlook.”

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That “negative sentiment” is impacting gross domestic product forecasts that continue to improve at some of Canada's largest financial and economic institutions.

The latest GDP figures from Statistics Canada showed the economy expanded 0.6 per cent in January, beating estimates of 0.4 per cent. The data agency also included a preliminary estimate for February of 0.4 percent growth, forcing some big bank economists to predict first-quarter GDP of 2.5 percent. On Wednesday, the Bank of Canada raised its growth forecast in its new Monetary Policy Report.

Maru's finding shows that the stronger economy is not reflected in the daily lives of a large number of consumers.

For example, a higher proportion of Canadians said their personal financial situation deteriorated in March: 24 per cent, compared to 23 per cent in February. Among those most likely to have reported a deterioration in their view of their financial situation were people in Atlantic Canada and Ontario, women, the survey's 18-34 age group, and those in the lowest income group They earned less than $50,000.

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More than half of Canadians said their daily and family finances would be a constant concern over the next two months. Additionally, 90 percent said they were not very likely to buy a home in the next 60 days.

“Rising inflation was swapped out and replaced with hockey stick high interest rates. That doesn't put people ahead, it keeps them where they were,” Wright said.

On the other hand, a growing number of people in British Columbia and Alberta and those with incomes between $50,000 and $99,000 said their personal finances had improved.

Given the persistent negativity, there was nothing to put upward pressure on the Maru Household Outlook Index, which remained unchanged at 87 and firmly in negative territory.

Any value below 100 on the index, which measures Canadians' outlook on the economy and their personal finances, indicates negative sentiment and any value above indicates optimism. It has been stuck in the red since December 2021 and reached its most bearish reading of 83 in March 2023.

Maru conducted the survey March 28-29 among a random selection of 1,532 Canadian adults.

• Email: gmvsuhanic@postmedia.com

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