The Canadian Survey of Consumer Expectations for the fourth quarter of 2024 reveals a nuanced picture of consumer sentiment. Conducted from October 31 to November 20, with follow-up interviews until December 3, the survey indicates that consumers feel better about their financial health compared to the previous quarter. This improvement is largely attributed to recent interest rate cuts and expectations of further reductions.
Consumers are less inclined to reduce spending and anticipate that their spending will grow faster than prices, marking a shift since 2021. However, high prices, economic uncertainty, and elevated housing costs continue to influence spending decisions. While consumer confidence in the labor market has weakened slightly below average levels, wage growth expectations remain stable.
"Rates are coming down, which is good," noted one participant during a follow-up interview. Meanwhile, home-buying intentions have increased as credit conditions ease, though timing remains uncertain for many prospective buyers.
Perceptions of inflation are returning to pre-pandemic norms. Some respondents expressed relief at this trend: "It's encouraging that it’s finally under control." Nonetheless, current inflation perceptions remain higher than pre-pandemic levels.
The survey results reflect varied opinions across different demographics and regions but do not necessarily represent the views of the Bank of Canada.