Canada: BoC survey shows businesses are less optimistic - NBF
According to National Bank of Canada analyst, Krishen Rangasamy, the recent survey of Business conditions from the Bank of Canada showed less confidence than the previous report. They see the BoC lowering GDP forecasts.
“The Winter edition of the Bank of Canada's Business Outlook Survey (conducted between November 5 and November 28) suggests businesses are less optimistic than in the Fall. That’s evidenced by the aggregate indicator sinking in Q4 to the lowest since the first quarter.”
“The balance of opinion about sales growth over the next year fell into negative territory ─ i.e. more respondents expecting a decline than expecting an increase ─, and that for the first time since 2011.”
“Intentions to increase employment and investment were both positive buoyed particularly by the services sector. Even then, the balance of opinion for investment fell a bit in Q4.”
“Inflation expectations were little changed with the large majority of firms (89%) still expecting inflation to be in the Bank of Canada’s 1-3% target range over the next two years.”
“The Business Outlook Survey won’t make the Bank of Canada more confident about the economic outlook. Expect the central bank to lower its 2019 Canadian GDP growth forecast in its upcoming Monetary Policy Report.”