Canadians upbeat on economy but edgy on finances: RBC

Fri Jul 2, 2010 6:46am EDT
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By Ka Yan Ng

TORONTO (Reuters) - Canadians became slightly more positive about the economy in June, but were worried about personal savings and rising interest rates, a consumer confidence survey released by Royal Bank of Canada on Friday showed.

The confidence report is one of several reports this week that have shown some cracks in popular sentiment toward economic recovery. A report from the Conference Board of Canada and a poll done by Angus Reid both showed consumer confidence falling in June.

"There's some indications of growing optimism on the overall state of the economy," said Paul Ferley, assistant chief economist at Royal Bank of Canada. "But there are some growing concerns with respect to questions on personal wealth with the recent weakening in financial markets."

In the RBC survey, sentiment about the Canadian economy swung higher, with 67 percent of respondents describing it as good, up from 54 percent in the last quarter.

But respondents were less optimistic about the future with 55 percent saying they believe the national economy will improve over the next 12 months, down two points from March.

Those offsetting factors left the overall RBC Canadian Consumer Outlook Index unchanged at 108 points in June, compared with a survey the bank did in March.

Worries about personal finances increased. The number of respondents who said their financial situation will improve in the next three months fell to 27 percent from 33 percent in March.

Almost four in 10, or 37 percent, said they have less money left over after all their bills are paid, down 4 points from March. Twenty percent were concerned that this situation will worsen and felt their ability to save money for things like retirement or education was less than three months earlier.   Continued...