Major purchases and discretionary spending may be curtailed if decline
TORONTO, July 24 /CNW/ - Consistent with analysts' downbeat
pronouncements on the state of the economy, the July results from TNS Canadian
Facts' Consumer Confidence Index paint a similar shaky picture.
"Waning consumer confidence is further evidence of softening domestic
demand and bad news for Canadian business. The decline comes as the Bank of
Canada places emphasis on the downside risk of higher inflation rather than on
stimulating demand," said Richard Jenkins, vice-president of TNS Canadian
Facts and director of the marketing research firm's monthly tracking study.
The overall Consumer Confidence Index is at 96.5 for July after falling
from 97.8 in June. Although the monthly decline was relatively small, the
overall index is significantly below the 109.0 high recorded in November 2007.
In just eight months, the index has gone down by 11.5 per cent. Recent
declines reflect a deterioration of current conditions rather than just
expectations for the future.
The Present Situation Index, which captures evaluations of the overall
state of the economy and the employment situation, stands at 106.4 (down
significantly from 110.1 in June).
The Expectations Index, which measures consumers' estimation of the
economy, household income and employment in the next six months, rose slightly
after reaching a low in June. The July index value is 94.4 (up slightly from
92.4 in June).
The Buy Index, which gauges the degree to which people think the current
period is a good time to make major purchases, dropped slightly. The index now
sits at 85.6 (down from 86.8 last month). Only 29 per cent of Canadians
currently think this is a good time to make a major purchase.
"Although confidence has not completely evaporated, we expect more and
more consumers to retreat from making major purchases and scale back
discretionary spending," added Jenkins.
Consumer Confidence Index tracks Canadians' attitudes about the economy
each month and is part of a global study conducted by TNS in 18 countries.
Three indices are produced each month to show how confidence in the economy is
changing: Present Situation Index; an Expectations Index; and a Buy Index. The
Canadian fieldwork is conducted using the firm's national bi-weekly telephone
omnibus service, TNS Express Telephone. A total of 1,015 nationally
representative Canadian adults were interviewed between July 14 and 17, 2008.
For a survey sample this size, the margin of sampling error is plus or minus
3.1 percentage points, 19 times out of 20.
TNS Canadian Facts (www.tns-cf.com) is one of Canada's most prestigious
full-service marketing, opinion and social research organizations.
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For further information:
For further information: Media Contacts: Richard W. Jenkins, Vice
President, Corporate Director, Public Opinion Research, Tel: (613) 230-4408
x101, e-mail: firstname.lastname@example.org; David Stark, Vice President,
Public Affairs, Tel: (416) 924-5751 x238, e-mail: email@example.com