Canada: Three-year low for Business hiring intentions – NBF

Krishen Rangasamy, analyst at National Bank Financial, explains that business sentiment is improving in Canada as depicted from the Autumn edition of the Bank of Canada Business Outlook Survey (conducted between August 20 and September 13) whose main index moved back into positive territory for the first time this year.

Key Quotes

“While sentiment about future sales was unchanged from last summer, intentions to invest in machinery and equipment climbed to a 4-quarter high, consistent with rising capacity pressures ─ 50% of respondents, the highest share this year, stated either some or significant difficulty in meeting an unexpected increase in demand.”

“Firms reported labour shortages (particularly in the services sector), but their intentions to increase employment dropped to the lowest since 2016Q3 as many respondents aimed for increased efficiency via automation. While positive for productivity that does not bode well for 2020 job growth.”