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Posthaste: Canadians divided on the economy and whether now is a good time to invest Back to video

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Canadians are divided when it comes to their views on the economy and whether now is a good time to invest, a new report suggests.

The survey from Edward Jones Canada found that 43 per cent of respondents believe now is a good time, but 40 per cent think it is not, while the remainder are unsure.

“High inflation and interest rates have made the past years financially challenging for many Canadians,” Julie Petrera, senior strategist at Edward Jones, said in a news release.

“Some are taking a wait-and-see approach while others are seeking investment opportunities in this economy.”

The research also found vastly different views depending on where the respondent lives. Overall, those in the prairie provinces were less inclined to invest now, compared to those in Quebec, of whom 51 per cent have a more optimistic outlook on the economy.

Among those who feel now is the right time to invest, most are focused on their financial goals, either long-term targets such as retirement or saving for a home (64 per cent), short-term goals such as travel or home renovations (37 per cent) or tax advantages (38 per cent).

Join us for a live Q&A on the Bank of Canada’s rate decision on Thursday, June 6 at noon. Register here

Among those not investing, 54 per cent point to uncertainty with the economy, 43 per cent are focused on paying down debt, while 54 per cent plan to invest once economic conditions improve.

Economic optimism could be on the verge of a turnaround with the possibility of interest rate cuts when the Bank of Canada announces its next policy rate decision.

In April, the Bank of Canada’s business outlook report found Canadians showed increased optimism with interest rate cuts on the horizon.

Economists are divided as to whether the central bank will begin cutting when it makes its decision today, but widely agree a July cut is almost certain if the central bank holds again.

Confidence has already begun to rebound on the commercial side. The Canadian Federation of Independent Business’ Monthly Business Barometer scored a 56.4 in the 12-month index, up nearly nine points from April and the highest since May 2023.

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BMO Capital Markets

The savings cushion that Canadians accumulated during the pandemic has largely withered away, as consumer insolvencies return to pre-pandemic levels following two years of steady increases.

Businesses are also struggling with the end of pandemic programs, as insolvencies spiked after the interest-free deadline to repay to the Canada Emergency Business Account loans passed earlier this year.

“Insolvencies will be one measure to watch closely to judge whether the broader economy is succumbing to restrictive monetary policy,” said Shelly Kaushik, an economist with BMO Capital Markets.

• The Bank of Canada makes its interest rate announcement at 9:45 a.m. today, followed by a press conference with governor Tiff Macklem at 10:30 a.m.
• Economic Club of Canada hosts an energy summit, featuring economists, industry executives, policy makers and government officials taking an in-depth look at the energy landscape in Canada.
• Today’s Data: Toronto home sales for May 
• Earnings: Lululemon Athletica Inc., Transcontinental Inc., Dollar Tree Inc.

• In search of novel solutions to the housing crisis? Look to Calgary
• Shopify shareholders approve executive pay plan they were urged to reject
• New policies driving economic growth could solve Canada’s productivity emergency, says RBC

With graduation season in full swing, many new grads are still figuring out what to do with their lives. From student loans, to choosing a career and finding a job in that field, this time can be stressful for those looking toward the rest of their lives. It doesn’t have to be, however. Sandra Fry has five savvy ways to help new graduates prepare for their future. Find out more here. 

Are you worried about having enough for retirement? Do you need to adjust your portfolio? Are you wondering how to make ends meet? Drop us a line with your contact info and the gist of your problem and we’ll try to find some experts to help you out, while writing a Family Finance story about it (we’ll keep your name out of it, of course). If you have a simpler question, the crack team at FP Answers, led by Julie Cazzin, can give it a shot.

McLister on mortgages

Want to learn more about mortgages? Mortgage strategist Robert McLister’s Financial Post column can help navigate the complex sector, from the latest trends to financing opportunities you won’t want to miss. Plus check his mortgage rate page for Canada’s lowest national mortgage rates, updated daily.

Today’s Posthaste was written by Ben Cousins, with additional reporting from Financial Post staff, The Canadian Press and Bloomberg.

Have a story idea, pitch, embargoed report, or a suggestion for this newsletter? Email us at posthaste@postmedia.com.

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