Exporter confidence retreats on global growth concerns, European instability: EDC
by Canadian Manufacturing Daily Staff
Despite concerns, survey found most Canadian companies still have a positive outlook
OTTAWA—Exporter confidence retreated from its spring rebound amid renewed concerns about the global economy and Europe’s fiscal struggles, according to a semi-annual survey.
The Export Development Canada (EDC) survey found most Canadian companies still have a positive outlook about their domestic and international sales over the next six months, despite the apparent concerns.
According to EDC, nine out of 10 Canadian companies surveyed believed their domestic and international sales will increase or remain the same throughout the winter.
“Since the fall of 2009, bullish exporter sentiment in the spring has given way to pessimism in the fall every year,” EDC chief economist Peter Hall said in a statement.
“This movement is not surprising given the mid-year softening that has occurred in each of the last three years. Volatility is also likely a by-product of global pessimism, which has prompted quick overreactions to negative developments.”
The EDC Trade Confidence Index (TCI) score overall moved down to 70.7, from 75.9 in the spring of 2012.
The current score remains consistent with normal economic conditions, the agency says.
Canadian firms say U.S. demand strong
Canadian exporters are also reporting demand from U.S. customers has remained strong over the past six months, according to survey results.
Three quarters of Canadian companies surveyed indicated U.S. orders either increased or remained at the same level since the spring.
“What Canadian exporters have been experiencing in real time is now showing up in the economic data, where the U.S. private sector is showing sustained, broad-based growth,” Hall said.
EDC’s TCI examines the attitudes of Canadian exporters as they forecast the business environment over the next six months through five index elements: trade opportunities; export sales; domestic sales; and both domestic and global economic conditions.
The survey was conducted in late September and early October 2012.
A total of 1,000 Canadian businesses participated, and the TCI was calculated on a total of 797 respondents.