Consumer confidence sinks to 27-year low in Canada

December 23rd, 2008 - 10:17 am ICT by IANS  

Toronto, Dec 23 (IANS) With Canadians increasingly worried about their jobs and finances, consumer confidence has sunk to the lowest level in a quarter century, said a survey by a Canadian think tank Monday.The index of consumer confidence has slipped for the third consecutive month in December, showing the seriousness of the economic crisis, said the survey by the Conference Board of Canada.

According to the survey, consumers indicated that they are financially worse off today than six months ago, and they expect to be worse off still six months from now.

Canadians were also pessimistic about the employment situation, according to the survey which featured telephonic interviews with 2,000 respondents.

“On a monthly basis, the (consumer confidence) index has now dropped significantly below early 1990s levels. Only during the recession of 1981-82 have we seen lower levels of confidence,” the survey quoted Glen Hodgson, senior vice-president and chief economist with Ottawa-based think tank, as saying.

“Despite the rapid fall in gasoline prices across the country, consumers continue to be gloomy about their financial situation,” he said.

Hodgson said the perception about the economic situation was turning increasingly gloomy and the falling oil and gas prices did little to cheer up people.

He said 26.5 per cent respondents said they were worse off today than six months ago - almost twice since the start of 2008.

With Canada’s unemployment rate predicted to go up to 8 per cent in 2009, Hodgson said, “We’re still in great shape compared to where we were in ‘82 or ‘91 (when employment rate reached 13 per cent and 10 percent respectively).”

Meanwhile, as oil prices slipped Monday, energy shares tumbled six percent on the Toronto stock market, pulling the composite index down 302.47 points to close 8,249.53.

Toyota’s forecast of its first-ever operating loss in the current fiscal year also brought the shares of Canadian auto-parts giant Magna International down by four per cent.

IT stocks were down 2.8 per cent, with BlackBerry maker Research in Motion diving $3.29 to $50.03.
The Canadian dollar closed slightly up at 82.03 cents US.

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