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Bank of Canada sees uptick in business confidence but Prairies remain weak

The Bank of Canada's business outlook survey released Jan. 13, 2020 suggests an uptick in business confidence amid continued weakness in the Prairies.
The Bank of Canada's business outlook survey released Jan. 13, 2020 suggests an uptick in business confidence amid continued weakness in the Prairies. Sean Kilpatrick, CP

The Bank of Canada’s latest business outlook survey suggests business confidence has edged higher as global trade tensions have eased, but the Prairies continue to remain a weak spot.

The survey, which is based on interviews with senior management at about 100 firms, says that outside of the energy-producing regions, reports of improved indicators of future sales are widespread. It says foreign demand, particularly from the U.S., continues to lift exports and expectations for U.S. economic growth have improved as trade tensions have declined.

Bank of Canada governor discusses economic forecast amid slowing global growth
Bank of Canada governor discusses economic forecast amid slowing global growth

The central bank’s Business Outlook Survey also suggested that labour shortages are a key obstacle to meeting an unexpected rise in demand except in the Prairies where businesses continued to report limited capacity pressures.

READ MORE: Canadian unemployment fell in December, economy added 35,200 jobs

Meanwhile, the Bank of Canada’s new Survey of Consumer Expectations suggests Canadians’ expectations for wage growth over the next year held steady near two per cent, just below their expectations for inflation.

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Canadians also expected their spending to increase faster than income growth, according to the report.

The new consumer survey also found mixed signals about the labour market as Canadians saw both an increased chance that they will leave their job voluntarily during the next 12 months and an increased probability that they will lose their job over the next year.

— With a file from Erica Alini at Global News