That’s the lowest price rise this year. From February through July, CREA’s monthly reports showed housing prices rising more than eight per cent over 2010.

The hottest provincial market in November was Newfoundland and Labrador, where prices were up 12 per cent from the same month in 2010. At the back of the pack was Prince Edward Island, where the average resale home price dropped 11.1 per cent.

At the municipal level, prices jumped more than 10 per cent year-over-year in the Ontario communities of Thunder Bay, Hamilton/Burlington and St. Catharines, in Quebec’s Saguenay region and in Gatineau, across the river from Ottawa.

“While certainly not gangbuster numbers, these are respectable turnouts given the volatile economic backdrop that has characterized the global economy this year,” Francis Fong of TD Economics said in a note.

Fong said that when the final numbers come in for all of 2011, he expects housing prices will show a seven to eight per cent rise for the year. Next year, though, he’s forecasting a one to two per cent drop amid a deceleration in income and job growth.

A recent report in the Economist magazine suggests Canadian homes are 29 per cent overvalued, rising at one of the fastest paces among the 20 countries surveyed. Since 2007, prices are up 22 per cent, it determined.

Vancouver is most expensive by far

Once again, the country’s most expensive homes by far were in Vancouver, where the average non-seasonally-adjusted sale price in November was more than $728,000. That beat Victoria at $499,676, B.C.’s Fraser Valley at $478,968 and Toronto at $480,421. The cheapest homes were in Trois-Rivières, Que., at $147,046.

Sales volumes nationally were up five per cent over last year, while the number of new listings increased 2.7 per cent. Compared with the month before, however, November saw a slowdown in new listings by a seasonally adjusted 3.4 per cent.

CREA’s figures are based on properties sold through the Multiple Listing Service.

The Bank of Montreal says the two western provinces of Alberta and Saskatchewan will lead the rest of Canada in economic growth this year and next by a wide margin.

The BMO report predicts the two provinces will both record three per cent or more economic growth this year — about one point higher than the national average — and again in 2012.

The report says Ontario and Quebec and the four Atlantic provinces will likely struggle with sub-two per cent growth next year as government austerity and export challenges due to the high dollar weigh on their economies.

On average, Canada’s economy is expected to continue with moderate growth of two per cent in 2012 — not strong but not a disaster given the weak U.S. economy, Europe’s debt crisis and the slowdown in emerging markets.

The western provinces’ benefits are natural resources, which are still much in demand across the world.

If there was something new in the one-page statement issued by the bank alongside its early morning policy announcement Tuesday, it is that bank governor Mark Carney thinks the risks from around the world may be intensifying.

The bank said it now expects the recession in Europe “to be more pronounced,” a downgrade from October when it said the continent would go through a brief slump.

While economic activity in the U.S. has been more robust than anticipated, the spillover effects of Europe and the country’s own internal problems will weigh on growth going forward. As for China and emerging nations that have been the mainstays of the global economy over the past few years, all signs point to the pace of expansion “moderating.”

“The weaker external outlook is expected to dampen GDP (gross domestic product) in Canada through financial, confidence and trade channels,” the bank said.

“The economy also continues to face competitiveness challenges, including persistent strength of the Canadian dollar…. Reflecting all of these factors, the bank has decided to maintain the target for the overnight rate at one per cent.”

The bank views its current policy setting as helping stimulate economic growth in Canada by keeping the cost of borrowing for both businesses and households low, thus encouraging investments and spending.

Some economists have called on the bank to lean on the rate further, to as low as 0.25 per cent, but there were no signals in the statement that Carney is thinking along those lines.

The bank said it is not worried about inflation at the moment. While at 2.9 per cent it is higher than the two per cent target the bank strives for, it expects weaker economic activity and moderating energy and food prices will bring overall inflation in line.

But Carney has often expressed concerns that his low interest rate policy, in place for about three years, is encouraging irresponsible behaviour among households, particularly overspending in the housing market.

As the bank noted in October, the Canadian economy is doing slightly better during the current second half of 2011 than was previously anticipated. GDP in the third quarter was one point higher than the bank’s two per cent call, and analysts believe the same adjustment will be made to the bank’s 0.8 per cent growth prediction for the fourth quarter.

The better performance, the bank said, has been due to stronger than expected household spending and continued healthy business investment. But exports have also so far defied the worsening global trends, recording solid gains in the third quarter.

The stronger second half will likely result in 2011 overall growth higher than the predicted 2.1 per cent, but the bank gave no guidance on its milder 1.9 forecast for 2012.

Provincially, the resource-based economies of Alberta, Saskatchewan and Newfoundland and Labrador outpaced the gains in the rest of the country. Those three resource-based economies have increased relative to the rest of the country over the last decade.

In 2000, Alberta, Saskatchewan and Newfoundland and Labrador combined accounted for 18 per cent of domestic incomes, while Ontario and Quebec combined accounted for 62 per cent. By 2010, the resource-based economies of Alberta, Saskatchewan and Newfoundland and Labrador had increased their share to 22 per cent, while Ontario and Quebec’s combined share had fallen to 57 per cent.

Output rose by 6.1 per cent in Newfoundland and Labrador, the best showing of any province. That strong showing came on the heels of a nine per cent loss the previous year. Among the territories, Nunavut led the way with an 11 per cent gain. Exports there increased sharply, as a result of a new mine that began production in 2010. Investment increased in all three of the fixed capital categories that the agency tracks: residential structures, non-residential structures as well as machinery and equipment.

Corporate profits rose 21 per cent as commodity prices and overall demand increased.

Statistics Canada says all eight major components it tracks from housing to clothing to recreation costs were higher last month on an annual basis. As has been the case so often before, the major drivers of the rising inflation rate last month were gasoline and food. The cost of gas was up 22.7 per cent over last year, while prices for fuel oil rose 27.4 per cent and prices for natural gas fell 4.7 per cent. Prices for food were 4.3 per cent from a year ago, overall. Consumers paid more for meat, with prices up 6.1 per cent; bakery products, which rose 7.2 per cent; and fresh vegetables, which soared 13.0 per cent.

Statistics Canada notes that the country’s underlying core inflation increased to its highest level in almost three years in September. The core inflation rate excludes volatile items, such as gasoline, and is considered a more accurate reflection of inflation trends.

The annual core rate rose two-tenths of a point to 2.2 per cent the largest year-over-year gain since December 2008. It’s the first time it’s been above the Bank of Canada’s two per cent target since February 2010.

Commenting on the numbers, David Madani of the research firm Capital Economic predicted in a note to clients that the consumer price index will continue to rise “somewhat above” the Bank of Canada’s expectations, and that inflation on food prices will reach at least six per cent by next year.

Still, while the jump in core inflation will likely raise some eyebrows at the central bank, few expect bank governor Mark Carney to raise interest rates next week.

“We still believe the Bank will refrain from removing any further monetary stimulus for the foreseeable future,” wrote Madani.

Some even expect Carney to cut rates. But in a note to his clients, Bank of Montreal’s Doug Porter says the “stickiness” of inflation makes this unlikely.

“While this result doesn’t completely rule out rate cuts, it relegates them to only the most extreme circumstance,” he said in the note.

“Moreover, if core stays close to this level let alone rises further the Bank of Canada may return to the tightening wheel sooner than most now expect, especially if financial markets stabilize.”

The central bank has held its policy rate at one per cent for over a year and Carney has made it clear he is remaining vigilant for signs of weakness of the economy, as well as keeping an eye on the European debt crisis and the potential for another global recession.

Despite economic uncertainty, Canada’s new car dealers said sales are growing at a “healthy pace” and driving retail sector activity. As the most important retail indicator, this is good news for the economy at large, the association said.

Affordability is driving a post-recession recovery in auto sales, chief economist Michael Hatch said, adding that very few if any other sectors can make such a claim.

Though not back to pre-recession levels of 1.65 million units, new cars sales have rebounded well since the end of the economic recession. They have grown by about two per cent so far in 2011, despite a 3.5 per cent drop in July and forecasted declines in August.

Hatch said sales are not far off the levels of 2007 because of the strength of the Canadian market and the impact of low interest rates. The situation is much better than the U.S., where sales are nowhere near pre-recession levels and Hatch claims may never get there.

Automotive sales are a key component of Canada’s economic activity, which is exposed to flagging consumer confidence as debt problems mount in the United States and Europe. Some economists have speculated that the global economy could be headed back into a recession. Canada weathered the first recession better than many countries, thanks in part to the relative strength of its banking system and prudent fiscal management, but the economic picture is still mixed.

Overall retail sales fell 0.6 per cent to $37.5 billion in July after three straight monthly increases, marking the first decline since January. Nevertheless, Statistics Canada reported Friday that the economy grew by 0.3 per cent in July after a 0.2 per cent increase in June. Manufacturing and, to a lesser extent, wholesale trade and transportation services the main sources of growth.

“It is important that Canadians are aware of one of our most expensive spending patterns—paying top-dollar on temporary fixes for the problems that grow out of poverty,” said Dr. John Rook, Chair of the Council.  “The good news is even more vital.  A better pattern is already partially in place, in policies and programs that enable people to get out of poverty, not just cope with it, and to be well and to thrive.  Now, we need to get the whole job done.”

The report draws on a wide range of local, national and international research from economics to epidemiology to illustrate how reducing poverty benefits everyone, no matter where we sit on the income ladder.

The report’s findings include: 

• In 2007, the amount it would have taken for every Canadian to have an income over the poverty line was $12.6 billion. The consequences of poverty that year added up to almost double that amount.  Despite this spending, by 2009, 3.2 million Canadians (9.6%) were still living in poverty.

• Indirect costs drive up the cost of poverty.  Stable housing costs less than shelter, ambulance, police, hospital and other bills resulting from homelessness. Similarly, basic medicine costs far less than emergency wards, where people end up when they can’t afford medicine.  This pattern can be found in the justice system, education, employment, business and other areas.

• Societal costs reflect the wasted potential—and tax dollars—of people who could be contributing more to the economy if they did not go hungry, or continued to be poorly paid, ill-housed, stigmatized or ignored.

• Solving poverty is about more than money because humans are social beings. The daily wear-and-tear of stress, including discrimination and lack of respect, can physically damage brains and bodies.  The lower you are on the income ladder, the more stressors you are likely to face, with the fewest resources to cope.  There is a direct relationship between poverty and poor health.

• The benefits of programs are often underreported. Child and seniors’ benefits, for example, provide secure, non-stigmatizing incomes broadly in society, and they have benefits well beyond individual recipients.  The improved wellbeing of today’s seniors compared to the past enables them to remain active in their communities or to help care for grandchildren.

The Council’s recommendations in the report focus on: a Canada-wide strategy to ensure everything works together; a sustained investment plan; a design framework centred on wellbeing; and a forum that brings people and ideas together to get the best results.

Rook emphasized Canada has more options than some other countries struggling with poverty and spending pressures, including wealth, experience, public support for mutual responsibility and social innovation.  “The way forward is practical and within our grasp, building on what we have and know already,” he said.

The full report, an ‘in-brief’ version and additional documentation are available at www.ncw.gc.ca.

World oil prices are set in U.S. dollars, so a rising loonie against the greenback offsets some of the impact of higher crude prices. Now that the loonie has slid below parity, consumers are getting a raw deal even though oil prices are 20 per cent lower than they were in July.

The loonie lost about five cents against the U.S. dollar last week, but rose 0.11 of a cent to 97.25 US on Monday (sept 26 2011).

Fear that another recession could be triggered by government debt problems in Europe and the United States has oil traders betting global energy demand will fall — pushing the price down from around US$100 per barrel in July to around US$80 on Monday.

Since crude is used to make gasoline, the price-drop should filter through to the gas pump, but the weaker loonie is offsetting the drop in Canada, McKnight said.

The Canadian average for regular unleaded gasoline Monday was just under $1.22 per litre, according to the price-tracking website Gasbuddy.com. That compared with about $1.25 a litre a month ago and $1.01 a litre a year ago when crude was at about US$77 per share.

McKnight, whose firm helps transportation sector clients manage their fuel costs, sees gasoline prices falling by about five cents over the next few months as demand weakens in the winter. While lower fuel prices are certainly a welcome silver lining for consumers, they are also symptomatic of wider economic challenges, said TD Bank economist Derek Burleton.

“In this kind of environment, oil prices are a bellwether of general global sentiment. It’s more symbolic of bigger challenges globally,” Burleton said.

“Unfortunately nobody wins in Canada’s economy when that happens, even if gasoline prices fall back a bit.”

Canada’s economy is highly reliant on exports of resources and manufactured goods. So if crude prices are falling because key trading partners are ailing, particularly the United States, it’s bad news for Canada. While falling crude prices will benefit gasoline consumers, it could also harm some Alberta oilsands producers, which need enormous amounts of capital to build and operate their projects.

“If oil settles below US$80, one tends to start getting a little concerned about near-term outlook for energy-producing provinces like Alberta,” said Burleton. ”I think US$80 is a little bit of a psychological threshold there.”

That means the bank’s policy rate will remain at one per cent until at least the end of October — and likely well into next year — ensuring low borrowing costs for Canadians.

The bank says in its latest statement that both the world and Canadian economies are weaker than expected, and risks have risen dramatically in the past month.

Financial conditions in Canada have tightened in the face of the global turmoil, it adds.

As a result, it says the need to withdraw stimulus in the form of super-low interest rates has diminished.

The bank says it is not worried that low interest rates will trigger inflation, noting diminished global demand and continuing low wage growth in Canada.

The vast majority of economists now are convinced Carney will keep the short-term rate at one per cent for another year.

Analysts say that if there is any change to the policy, it may be to lower the rate rather than raise it by the year’s end, say analysts.

In the United States, the Federal Reserve Board has said it will keep rates at current low levels for at least another two years to try and stimulate the sagging economy.

On Wednesday, the markets are eagerly awaiting the governor’s views about the near future prospects and whether he will signal a possible rate decrease.

In July, the last time Carney pronounced on interest rates, the bank’s statement began with the often-voiced mantra that “the global economic expansion is proceeding broadly as projected.”

That won’t do anymore, says Bank of Montreal economist Douglas Porter.

At the time, Carney had expected the second quarter to show a 1.5 per cent growth rate — anemic perhaps, but far better than the minus 0.4 per cent the economy actually got.

Now the prospect of a second recession, particularly in the U.S., has gained currency, which will have stark implications for Canada in terms of jobs and government budgets.

Scotiabank economist Derek Holt says he doesn’t believe there is sufficient urgency to cut interest rates now, but he says the governor must become more realistic about the economic landscape.

“Not exactly what the doctor ordered, but not bad,” BMO Capital Markets deputy chief economist Doug Porter wrote in a note to investors.

“The Canadian jobs report sets a reasonably good table. The headline jobs tally was a touch light, but the details of the report are unambiguously healthier — the strong gain in full-time jobs, the pop in private sector employment, and the fact that the overall number was skewed lower by yet another July drop in education employment.”

While the number of net jobs created was lower than predicted, the unemployment rate came it pretty much as economists had forecast.

“Markets had been expecting an unchanged position,” Peter Buchanan, senior economist at CIBC World Markets, wrote in an investors’ note.

“A fairly mixed report overall, with the details somewhat better than the headline.”

Increases in the private sector were offset by losses in the public sector and fewer people who were self employed.

The gains were led by the construction sector, which saw an increase of 31,000 jobs. Employment in the transportation and warehousing sector was up 28,000 jobs, and there were also 28,000 more people working in retail and wholesale trade in July. There were 39,000 fewer jobs in health-care and social assistance, 30,000 fewer jobs in elementary and secondary schools, 14,000 fewer jobs in business, building and other support services, 11,000 fewer jobs in natural resources and 9,000 fewer jobs in agriculture.

Alberta and Newfoundland and Labrador posted job gains in July, while Ontario saw losses.

Employment was down 22,400 jobs in Ontario following a slight increase in June. Despite the drop, employment growth over the last year stands at 1.6 per cent, which is similar to the national growth rate.

The rest of the provinces were largely unchanged. Quebec’s jobless rate fell slightly, mostly because of fewer people entering the workforce.

Search for Canadian Jobs

According to the survey, the majority of Canadians have let their budgeting (38%), saving (37%) and bill payments (50%) slip by the wayside as they enjoy the warm weather this year.

“Summer is a great time to relax and have fun with friends, but it doesn’t mean you should take a vacation from your financial responsibilities,” says Raymond Chun, Senior Vice President, TD Canada Trust. “If you take a little time to plan ahead and tweak your budget in preparation for your summer spending, you can make the most of the warmer weather without compromising your savings plan.”

Canadians attribute the lure of the summer sun, patios and travel opportunities as the cause of their lax attitudes towards their personal finances. Two-thirds say the weather makes them feel happier and more willing to spend money (66%) or that there are so many activities to enjoy in the summer they figure they’ll make up the money in the colder months (64%). Six-in-ten attribute their splurges to eating and drinking out more with friends (61%) or taking more vacations (60%).

“Summer vacations can certainly take a toll on your wallet. If you think you’ve been too carefree with your spending, there are simple things you can do to get your finances under control without compromising on summer fun so that you’re in good financial shape by the end of the season,” he said.

Chun offers his advice on how Canadians can enjoy this summer without compromising their savings plan:

1. Automate your financial responsibilities – Set up pre-authorized transfers to your regular bills and minimum credit card repayments. That way you don’t have to worry about interest and fees incurred on forgotten bills while you’re out enjoying the summer sun.

2. Revisit your budget – Calculate how much money you earn each month then subtract your  expenses, like rent or mortgage repayments, food, utilities, insurance and credit card bills, to understand how much you really have left over. Subtract the amount you want to save every month, and only then do you have a true picture of what you have left for discretionary spending. “Many Canadians find their food and entertainment bills are higher in the summer, because they’re out more with friends. If this is the case, you should revisit your budget to cut down on spending in other areas to make up the difference, and not cut into your savings or take on debt,” says Chun.

3. Don’t get carried away with summer spending – Look at ways to cut down on unnecessary expenses, but don’t deprive yourself or it will be a tough budget to follow. Invite friends over for a backyard barbeque instead of frequenting restaurant patios regularly after work. Canada’s summers are beautiful so it’s tempting to splurge on summer accessories, but remember you may only get another two months out of a new pair of sandals or summer dress before the cooler weather starts rolling in.

4. Get any debts under control – Review your unpaid bills and debt obligations. If you’re low on cash and can’t make all your payments then pay the minimum required. High interest debts like credit cards should take priority. At the end of the summer if you’re still struggling with your repayments, then speak to your bank about ways to consolidate and manage your debt.

5. Start planning now for your next seasonal splurge – While enjoying the summer months can be fun, getting yourself into serious credit card debt is not. You need to break the cycle on how you pay for summer activities like vacations and eating out.  Start putting aside money in advance for next year’s holidays.

What else falls by the wayside in the summer?

One-in-two Canadians admit they are also more lax in the summer in terms of keeping in touch with family (56%), exercising (55%), keeping their homes tidy (54%) and eating healthily (53%). One-in-ten say they are even more likely to call in sick to work.

Actual (not seasonally adjusted) activity came in 2.7 per cent above levels reported last May. This was the first year-over-year increase in more than a year, reflecting falling sales activity in May 2010. Activity fell sharply last year between April and July, with May marking the mid-point of that slide. Although activity has been more stable this year, last year’s sales volatility is expected to continue to affect year-over-year comparisons in the months ahead.

Highlights:

• Sales activity held steady from April to May, but posted the first year-over-year gain in over a year due to falling demand in May 2010.
• Year-to-date sales are in line with the ten-year average.
• New listings also remained stable from April to May.
• National housing market remains firmly entrenched in balanced territory.
• National average price is still being skewed upward by historically high sales activity in certain Vancouver neighbourhoods.

A total of 196,749 homes have traded hands via Canadian MLS^® Systems so far this year. This is in line with the ten-year average for year-to-date activity in May.

“The Canadian housing market has seen some big ups and downs in recent years, making national sales activity so far this year look like something of a Goldilocks story by comparison – not too hot, not too cold,” said Gary Morse, CREA’s President. “Since local housing market trends often differ from national trends, buyers and sellers should consult their local REALTOR^® to understand how the housing market is shaping up where they live.”

Seasonally adjusted new residential listings were little changed from April to May, edging up one tenth of a percentage point. The number of newly listed homes fell in Vancouver, Fraser Valley and the Okanagan region in May, offsetting small gains in Toronto andMontreal.

With sales and new listings holding steady on a national basis in May, the resale housing market remained firmly planted in balanced territory. The national sales-to-new listings ratio, a measure of market balance, stood at 52.1 per cent in May, little changed from 52.5 per cent in April.

Based on a sales-to-new listings ratio of between 40 and 60 per cent, housing markets were balanced in 62 of 101 real estate boards in Canada. Less than half of the rest can be characterized as sellers’ markets, based on a ratio above 60 per cent. “For the most part, sellers’ markets became slightly more balanced than the previous month,” said Gregory Klump, CREA’s Chief Economist. “Toronto stood out as an exception, with sales activity there growing faster than new supply.”

The seasonally adjusted number of months of inventory stood at 6.1 months at the end of May on a national basis. This is little changed compared to the six months of inventory at the end of April 2011. The number of months of inventory represents the number of months it would take to sell current inventories at the current rate of sales activity, and is another measure of the balance between housing supply and demand.

The national average price for homes sold in May 2011 was $376,817, up 8.6 per cent from the same month last year. A number of compositional factors skewed the national average price upward in May. These factors include historically high sales activity in selected priceyVancouver neighbourhoods and broadly based price gains in Toronto, where supply remains tight relative to demand. If Vancouver sales are excluded from the calculation, the year-over-year change in the national average price amounts to 5.6 per cent; excludingToronto and Vancouver shrinks the increase to 3.7 per cent.

“Changes in the national average home price reflect variations in home sales activity across and within local markets,” said Klump. “Failure to recognize changes in the mix of sales activity can lead to misinterpretation of average price fluctuations. It can also give rise to faulty predictions of broadly based home price deflation by way of price correction.”

“I think it’s worrisome,” said Carrie Russell, senior vice-president of retail banking at TD Canada Trust (TSX:TD).

“The reality is that we are all going to come into unexpected expenses from time to time, be it a car or health or a job loss and this can really derail you and your family if you have no cushion behind you,” Russell said from Toronto. Russell said the major factor that’s preventing Canadians from saving is they are using their disposable income to pay debts they already have, such as credit card, car loans or mortgages.

One-third of Canadians who responded to the recent online survey said they didn’t have enough money to cover living expenses like rent or food bills. The survey found that 54 per cent of the 1,003 people who answered also said it was a real struggle or impossible to save.

Repaying those debts will only get harder if the Bank of Canada raises interest rates this summer, as expected. A spike in Canada’s inflation rate in March was driven by higher food and gas prices.

Shopping is also taking a toll on tucking money away for a rainy day. Russell said 12 per cent of those surveyed said they couldn’t save because “they shopped beyond their means.” Nineteen per cent of those surveyed under the age of 35 said they spent too much on shopping, she added.

“This really comes down to the age old question of budgeting, choices and skills required in making plans for a healthy financial future.”

Changing habits starts with children and making sure they understand how much things cost and understanding the difference between a “want” versus a “need,” she said.

“We don’t send our children into the deep end of the ocean without teaching them how to swim. We shouldn’t send our children out into the workforce and independent lives without giving them the basics of financial literacy.”

On the flip side, 30 per cent of the respondents said they had enough money saved to cover living expenses for at least four months. Russell said those who are most successful with savings are “paying themselves first” and are using automatic savings programs to put money aside.

The online survey, based on a representative sample of Canadian adults, was conducted before Christmas from Dec. 2 to 7 by Environics Research for the bank. TD used the survey results to publicize its services for helping customers with their savings. The survey found the top goals for the respondents were: saving for retirement (73 per cent), paying off credit cards (72 per cent), and major purchases or vacations (53 per cent each).

On a regional basis:

• 22 per cent of respondents in the Atlantic provinces said they found saving “impossible” and 43 per cent indicated any left-over money was being used to pay down debt.
• 54 per cent of respondents in Ontario said they found it a “real struggle” or impossible to save and 33 per cent said they didn’t have enough money to cover living expenses.
• 33 per cent of respondents in Saskatchewan and Manitoba indicated it was a real struggle to save but a larger portion (37 per cent) said they had enough money saved to cover at least four months of living expenses.
• 55 per cent of respondents in Alberta said it was a real struggle or impossible to save but 31 per cent said they had enough money saved to cover at least four months of living expenses.
• 44 per cent of respondents in British Columbia said it was a real struggle or impossible to save; 30 per cent said they didn’t have enough money to cover living expenses.

The majority, 92% rated Canada, as the best for its diverse environment, natural beauty and resources, while 94% said its peaceful nature was a real draw. Expats from around the world now account for more than 70% of the whole Canadian labour force growth.

Canada leads the G7 in terms of the safest place to live and conduct business with the most fairly administered judicial system. It was the leading performer among the hard-hit G7 developed economies during the global recession, helped by its sound banking system and the fact it avoided the property crash seen in the United States and much of Europe.

READ THE REASONS PEOPLE GAVE FOR MOVING TO CANADA

In second place is New Zealand, followed by Australia, France and South Africa. Making up the rest of the top ten is Portugal, Spain, the United States, the United Arab Emirates and Singapore.

As well as the country’s natural beauty and peaceful reputation, Canada’s healthcare system is also well regarded by expats living there and was rated high by 90%. Furthermore high standards of education are enjoyed by expats in Canadian Schools and Universities. Canada has the highest percentage of individuals achieving at least college or university education among the top 50 countries surveyed by the World Competitiveness Yearbook, 2009.

‘This is the second year Canada has topped the tables of the NatWest IPB Quality of Life Index. Its excellent working conditions, financial security and peaceful reputation have pushed Canada into this year’s pole position. It seems the pull of the beautiful Rockies, the Mounties and the marvellous taste of maple syrup is a real sticking point for expats,’ said Dave Isley, head of NatWest International Personal Banking.

’As a member of the Commonwealth, Canada offers Brits common values and goals shared with the UK, helping British expats settle into the country and feel at home,’ he added.

The booming economy in Canada also makes the country more attractive. Canada‘s recent expatriate intake has been double those of the United States, with priority given to highly skilled workers.

Financial assets in Canada are up 6% from last year’s levels. Household finances improved in the fourth quarter of 2010, and net worth is rising to record levels. Household net worth per capita increased to $181,700, representing the highest level on record.

Canadian household net worth grew by 2.2% in the fourth quarter of 2010 to $6.2 trillion. The gain pushed Canadians’ net worth to a new record high, 4.1% above the pre-recession peak seen in the second quarter of 2008 and 14.6% above the recessionary trough seen in the first quarter of 2009.

‘UK expats say they are living a more fulfilled lifestyle abroad, whilst also benefiting financially. This is particularly true for UK expats in Canada who not only say they benefit from financial security, improved cost of living and a happier working environment but a better work life balance and equal opportunities,’ explained Isley.

For the wider expat community, living and working abroad enables them to earn and save more despite the current economic downturn. More than half of those living and working abroad earn between £50,000 and £100,000. Expats based in Hong Kong have the highest salaries with close to half earning more than £100,000 a year.

The factors that influence individuals’ decisions on where they pursue their careers are many, but a key factor is the powerful link between earning capacity and the ability to build a nest egg. Some 74% of respondents claim to have increased disposable income since becoming expats.

Top 12 Expat Destinations:

1.  Canada
2.  New Zealand
3.  Australia
4.  France
5.  South Africa
6.  Portugal
7.  Spain
8.  U.S.
9.  United Arab Emirates
10. Singapore
11. Hong Kong
12. China

“It was a huge jump,” said Ian Lee, business professor at Carleton University. “I think it caught everybody off guard. It was not supposed to come in this high.”

If the economy sees another month of high price increases, it will put “great pressure” on Bank of Canada Governor Mark Carney to raise interest rates in May, Lee said.

The BoC aims to keep inflation between one and three per cent. Last week, it opted to keep its key interest rate at one per cent, forecasting that inflation would hit 3 per cent this spring and then ease off. Statistics Canada said prices rose in all eight major components that it tracks. But the main contributors were fuel and food prices.

Gas prices rose 18.9 per cent, while fuel oil and other fuels surged 31.3 per cent. Electricity costs increased by 4.3 per cent. Transportation costs, which have a heavy gasoline component, were up 6.6 per cent, as consumers paid more for car insurance and air transport.

On Tuesday (19 April 2011), the average price at the pumps in Canada was nearly $1.30 per litre, according to the website GasBuddy.com.

Frank Atkins, an economics professor at the University of Calgary, said that in Canada rising gas prices are being driven partly by growing demand as the summer driving season approaches.

“Then you add into the mix that we haven’t built a new refinery in 25, 30 years and so we don’t have enough refinery capacity. All this is squeezing these gasoline prices up,” he said .

When energy prices are excluded, the Consumer Price Index rose 2.4 per cent in March, year over year. And when eight of the CPI’s most volatile components are excluded, the core rate of inflation picked up to 1.7 per cent. Food costs rose by 3.3 per cent — the largest year-over-year advance since August 2009. That was in part because the price for fresh vegetables rose by a stunning 18.6 per cent. ”The cost of meat rose 5.0 per cent in March, as beef and pork prices increased. Higher prices were also recorded for bakery and cereal products as well as for dairy products,” the agency noted.

Shelter costs, with the exception of mortgage interest, recreation, household operations, health and personal care, alcohol and tobacco, even clothing and footwear were all higher in March than last year, though the gains were modest.

Craig Alexander, chief economist for TD Bank Financial Froup, said it’s the higher gas prices that are hitting Canadians hardest but he notes the rising cost of oil is a double-edged sword for Canada.

“Higher gasoline prices are having an impact on household wallets. The average family spends about $3,500 a year on gasoline. And there’s been about a 20 per cent increase in the price of gasoline,”

With Canadian families spending about $700 more a year on gas right now, “that’s a punch,” Alexander said.

“But for the Canadian economy as a whole however — it sounds a little perverse, but because we’re a net oil-exporting country, higher oil prices are good for Canada… So it’s bad for households but it’s good for some regional economies… like Alberta, Saskatchewan and Newfoundland.”

Computer equipment and supplies were one area in which prices fell, dropping 9.9 per cent. Video equipment dropped 10.4 per cent. Prices for fresh fruit and natural gas also fell. But the overall trend toward higher prices is part of a larger international trend that could be a positive sign for the global economy, according to Carlos Leitao, chief economist at Laurentian Bank Financial.

“Inflation in Canada and around the world is certainly on the rise… I think the days of extremely low inflation, as we had it in 2010, I think those days are behind us,” he said.

“One of the reasons why we see a bit of inflation and higher interest rates is because the economy is actually operating at a higher level of capacity utilization. In the end, that’s good news.”

Here’s what happened in the provinces and territories. (Previous month in brackets):

• Newfoundland and Labrador 3.2 (2.9)
• Prince Edward Island 2.4 (1.9)
• Nova Scotia 3.9 (3.4)
• New Brunswick 3.1 (2.2)
• Quebec 3.3 (2.2)
• Ontario 3.6 (2.5)
• Manitoba 2.8 (2.1)
• Saskatchewan 3.0 (2.2)
• Alberta 2.0 (1.2)
• British Columbia 3.1 (1.8)
• Whitehorse, Yukon 3.2 (1.3)
• Yellowknife, N.W.T., 3.1 (1.5)
• Iqaluit, Nunavut 1.7 (1.1)

“In a more balanced housing market, it makes sense that younger and first time homebuyers are waiting to assess all of their options and do their research before buying a home,” said Bernice Dunsby, director of Client Acquisition, Home Equity, RBC. “It’s also important to get expert advice on what you can afford and leave yourself with a little extra wiggle room in your budget so you don’t become house poor, as home maintenance and lifestyle costs can add up.”

The poll found that younger Canadians are more likely to purchase a home than other age groups, as 43 per cent (aged 18-34) are looking to buy in the next two years, compared to the national average of 29 per cent. Older Canadians are much less likely to buy in the next two years, including those aged 35-54 (29 per cent) and over-55 (17 per cent).

When looking for advice on purchasing a home, younger homebuyers (aged 18-34) are more likely to use real estate websites (55 per cent) or family (48 per cent) and friends (35 per cent). The majority of older Canadians, aged 45-54 and over-55, are more likely to rely on a real estate agent as their choice for advice, at 71 per cent and 74 per cent respectively. “Being prepared and working with a mortgage specialist will help you buy with confidence and give you expert advice on current financing options,” added Dunsby. “Having a mortgage pre-approval is a critical component of buying a home, particularly for younger homebuyers. It presents you as a serious purchaser to both realtors and sellers.”

According to the poll, younger Canadians (aged 18-34) are most concerned about having a good down payment (23 per cent) and rising real estate prices (23 per cent) when looking to buy a home. Canadians aged 35-54 are most concerned with rising prices, as 24 per cent are worried about mortgage rates and 25 per cent about home prices increasing. Canadians over the age of 55 list increasing home prices (36 per cent) as their biggest worry when deciding to purchase a home.

While 43 per cent of younger Canadians (aged 18-34) are paying off their mortgage faster than they expected, two-thirds (66 per cent) say it is larger than they would like it to be.

5 tips for Canadians looking to buy a home:

Leave some wiggle room: Line up your paycheque and compare it to your total costs. Make sure that you have enough left over for new furniture, repairs and costs of living. Do a spending analysis to see what the total costs of homeownership would be relative to your lifestyle and build that into your plan (i.e. if you enjoy eating out or going to the gym).

The power of the pre-approval and stress test: Make sure you have your financing in order before you start your search – it will show sellers and real estate agents that you’re serious.Mortgage pre-approvals have no obligation and help lock in your interest rate. Work with a professional mortgage specialist to test your mortgage for potential mortgage rate and cost increases to make sure you can handle it.

Don’t overbuy: Be realistic in choosing a home that’s within your means and make concessions on what you’re looking for. Set aside a budget for ongoing home maintenance and potential cost increases (for utilities, taxes and fees). Online tools and calculators can help you plan your budget.

Look at payment flexibility: Look at a mortgage that provides you with the option of doubling up your mortgage payment or putting down a lump sum payment once a year. Doubling up your mortgage payment just once per year can save you tens of thousands in interest costs and take years off your mortgage amortization period.

Don’t forget closing costs: Closing costs are typically one to two per cent of your final purchase price. Build this into your budget along with the cost of new appliances, utility and cable hookup and moving costs.

Types of homes are Canadians looking to buy?:

Younger Canadians (ages 18-34)

• Detached house 59 per cent
• Condo/loft 15 per cent
• Semi detached house 10 per cent
• Townhouse 10 per cent

Mid-range Canadians (ages 35-54)

• Detached house 71 per cent
• Condo/loft 10 per cent
• Semi detached house eight per cent
• Townhouse seven per cent

Older Canadians (55 and older)

• Detached house 68 per cent
• Condo/loft 15 per cent
• Semi detached house five per cent
• Townhouse five per cent

And some think Carney will want to wait until the fiscal direction of the next government is known — particularly if there is a change — before moving.

“There is nothing written in stone,” says Douglas Porter, deputy chief economist at BMO Capital Markets, “but my view is that the bank would rather lay low and not become an election issue.”

In the latest survey of economists taken last week, about half saw the bank starting to a new tightening cycle on May 31.

But with the government set to fall in a non-confidence vote on Friday, that consensus may change.

The Canadian Imperial Bank of Commerce announced Wednesday it was moving back its prediction on when Carney will begin tightening monetary policy to July.

CIBC chief economist Avery Shenfeld says the election is one reason he believes the bank will hold off until July. The others are the strong dollar — which would rise along with interest rates — still soft core inflation and the relatively high 7.8 per cent unemployment rate.

“Even a July rate hike is only 50 per cent priced in, so our view would still be consistent with some upward pressure on Canadian bond yields from here to the summer,” he added.

Scotiabank thinks the next rate hike won’t happen until October, and the election is one of the factors.

Scotiabank economist Derek Holt notes that over the past 20 years, since moving to the current inflation-targeting mandate, the central bank has largely avoided switching to a tightening cycle around an election. The only time it did so was in 1997, three weeks after the June 2 vote.

“There has actually been no election in at least the past two decades in which the (Bank) began a tightening campaign before the election itself,” Holt added.

The bank has continued an already established tightening trend during an election before, in December 2005. And in October 2008, Carney cut rates by 50 basis points in co-ordination with other central bankers as the global economy was collapsing.

Part of the reason for not wanting to change course in election periods is that the Bank of Canada scrupulously guards its reputation as an impartial, independent institution. A rate shift could become an issue in a political campaign, because not only is it a pronouncement on the economy, but also directly impacts consumers and businesses. But the more important reason, says Holt, is that the central bank doesn’t want to start tightening, which could slow the economy, until it knows what the next government will do.

“When you are uncertain about the risks facing fiscal policy and the outcome of an election, the prudent thing is to keep your powder dry and then decide what you are going to do,” he explained.

The bank will almost certainly stay on hold until the results of this spring’s expected election are in, but may also wait until the next budget, says Holt. That’s because he says the bank will see no compelling reason to act precipitously, given the lukewarm state of the economy.

Porter says the central bank may also pull its punches when it releases its next quarterly economic outlook on April 13, a time when the campaign is expected to be in full swing.

“If they had any intention to raise rates in May, normally they would have sent a signal in the monetary policy review in April,” he said. “But if that’s in the middle of a campaign, they might mask the language.”

With all components considered, Canada’s overall inflation rate fell one-tenth of a point to 2.2 per cent over the 12 months to the end of February, with energy prices the biggest factor holding it from dropping even further. It was at 2.3 per cent in January.

Energy prices rose 10.6 in February from a year earlier, compared to a nine per cent pace in January, Statistics Canada said. Gasoline prices jumped 15.7 per cent during the month, from a 13 per cent annual pace in January.

Economists were expecting the core rate to come in at 1.1 per cent and the overall rate to drop only slightly to 2.3.

On a month-to-month basis, consumer goods were 0.3 per cent more expensive last month than in January, again mostly due to higher energy and gasoline prices.

On a regional basis, Nova Scotia remained the province with the highest inflation rate at 3.4 per cent. Many people in the province use oil and other fuel to heat their homes. Alberta continued to enjoy the most stable prices, with an inflation rate of 1.2 per cent. Drivers in every province except Manitoba faced double-digit price increases for gasoline on a year-over-year basis.

Canadian residents took 732,000 overnight trips to overseas countries, down 2.2 per cent from December.

Travel by U.S. residents to Canada declined 1.7 per cent to 1.6 million trips in January.

Overseas residents took 369,000 overnight trips to Canada in January, 2.2 per cent more than in December and the highest level in two years.

Seven of Canada’s Top 12 overseas markets recorded advances in January, with travel from China rising 11.6 per cent, the largest increase, and travel from India falling 6.4, the largest decline.

Actual (not seasonally adjusted) national sales activity via the Multiple Listing Service® (MLS®) Systems of Canadian real estate Boards came in 5.9 per cent below levels reported last February. This marks the smallest year-over-year decline in nine months, and the fourth consecutive month in which sales activity was on par with the five-year average for that month.

Seasonally adjusted home sales activity edged down 1.6 per cent in February 2011compared to the previous month on a national basis. Sales activity eased in almost two-thirds of all local markets from the previous month, offsetting monthly increases in activity among other markets including Vancouver and Calgary.

Nationally, new listings in February edged up 1.5 per cent from the previous month on a seasonally adjusted basis, which builds on the 4.3 per cent monthly increase in January. The rise in new listings is consistent with CREA’s expectation that many sellers, who shied away from listing their home last summer when the national housing market softened, would list their home in early 2011, having by now observed improved demand and stable prices.

With both sales activity and new supply little changed in February, the housing market remained firmly in balanced territory. The national sales-to-new listings ratio, a measure of market balance, stood at 53.5 per cent in February. This is little changed from the previous four months.

“Most local housing markets in Canada are well balanced, but there are still a number of buyers’ and sellers’ markets,” said Georges Pahud, CREA’s President. “Housing market trends often evolve and diverge from national trends due to local factors, so buyers and sellers should consult their local REALTOR® to understand how the housing market is shaping up where they live.”

The number of months of inventory represents the number of months it takes to sell current inventory at the current rate of sales activity, and is another measure of the balance between housing supply and demand. The seasonally adjusted number of months of inventory stood at 5.7 months at the end of February on a national basis. This is little changed from the 5.5 months reported in January, when it reached the lowest level since last April.

The national average price for homes sold in February 2011 rose 8.8 per cent year-over-year to $365,192. “The average price has been skewed higher nationally and in British Columbia recently by a record number of multi-million dollar sales in a couple of areas in GreaterVancouver,” said Gregory Klump, CREA’s Chief Economist.

“When you take Vancouver out of the equation, the year-over-year increase in the national average price drops to 3.4 per cent,” added Klump. “While that’s still stronger than in the past six months or so, national average price gains may recede after tighter mortgage regulations take effect in March.”

Meanwhile, the value of non-residential permits fell 22 per cent to $1.9 billion, the lowest level since January 2010. This decline was due primarily to decreases in the commercial and institutional components in almost every province. The value of permits issued rose in half of the provinces, led by Ontario. Quebec recorded the most important decline.

For 2010 as a whole, the value of building permits issued by municipalities was up 19.8 per cent to $73.1 billion.

The year-over-year increase was largely driven by a sharp rise in residential construction intentions, which jumped 27.6 per cent from 2009 to $44.3 billion.

In the non-residential sector, the value of permits totalled $28.8 billion, up 9.5 per cent when compared with 2009. Permits issued for multi-family units rose 55.3 per cent to $1.6 billion in December, the highest level since April 2008. There were increases in seven provinces, with Ontario accounting for most of the gain.

The value of building permits for single-family units rose 3.6 per cent to $2.1 billion, a second consecutive monthly gain. There were increases in six provinces, led by Ontario and Newfoundland and Labrador. Quebec, on the other hand, experienced the largest decline in single-family construction intentions.

At the national level, municipalities approved the construction of 17,893 new dwellings in December, up 27 per cent. Most were multiple-unit projects.

The value of commercial permits fell 21.7 per cent to $1 billion. This marked a second consecutive month of large declines.

In the institutional component, permits totalled $396 million, down 38 per cent from November.

It was the third straight monthly decrease in this sector, pushing it to its lowest level since February 2009. Every province except Saskatchewan recorded a decline in this area, with the largest drops coming in permits for medical facilities in Quebec and educational institutions in Ontario.

After two consecutive monthly gains, industrial construction intentions edged down 0.4 per cent to $450.5 million. Overall in December, the value of building permits rose in five provinces. The largest gain was in Ontario, with substantial jumps in housing permits. Quebec recorded the most important decline, following an 18.2 per cent increase in November. The decrease was due primarily to lower construction intentions for institutional and commercial buildings in the non-residential sector.

Economy generates 69,200 new jobs, but jobless rate up

While the jobless rate rose, it was actually a good sign: the rate jumped because 106,400 more Canadians returned to the job market. That’s about four times bigger a boost than most economists had expected and the largest since last April.

The agency says there are 327,000 more Canadians working since last January, and 467,000 more jobs since the downturn ended in July 2009. Canada can now say that all the jobs lost during the recession have been recovered — the only country in the G7 that can make that boast.

The new jobs gained in January were shared between private sector, public sector and the self-employed. The new jobs were also closely split between full-time and part-time: full-time employment rose by 31,100 in January, and part-time jobs rose by 38,000.

More women than men found work last month, and the majority came in the service sector. January’s gains were spread among six provinces, led by Ontario with an increase of 36,300, and Alberta, which picked up 21,600.

Here’s what happened provincially (previous month in brackets):

• Newfoundland 12.4 (14.0)
• Prince Edward Island 11.3 (11.8)
• Nova Scotia 9.5 (10.4)
• New Brunswick 9.1 (9.4)
• Quebec 7.9 (7.5)
• Ontario 8.1 (8.1)
• Manitoba 5.0 (5.2)
• Saskatchewan 5.4 (5.5)
• Alberta 5.9 (5.5)
• British Columbia 8.2 (7.6)

Search for Canadian jobs here

The 2.4 per cent annual gain was just under the 2.5 per cent that a consensus of analysts was expecting.

On a seasonally adjusted basis, consumer prices rose 0.3 per cent from November to December. The increase in gasoline prices was the main factor in that gain, too, the agency said. December’s increases helped contribute to a general growth in consumer prices throughout 2010.

The 2.4 per cent annual gain was just under the 2.5 per cent that a consensus of analysts was expecting.

For the year, Canada’s inflation rate averaged 1.8 per cent, much higher than the 0.3 per cent average in 2009, when inflation at times dipped below zero.

“For 2010 as a whole, prices increased in seven of the eight major components … the exception was clothing and footwear,” the agency reported.

“Prices rebounded in the transportation and shelter components — rising in 2010 after declining in 2009 — driven by price increases for energy and passenger vehicles.”

Still, economists note that inflation remains relatively tame in Canada. The much-watched Bank of Canada core index, which excludes volatile items such as energy, rose only one-tenth of a point in December to 1.5 per cent. That is still well below the central bank’s desired target of two per cent.

“Inflation averaged 1.8 per cent for all of 2010, up from 0.3 per cent in 2009, but still quite tame considering the HST [harmonized sales tax] in Ontario and B.C. hiked the total by nearly 0.4 percentage points,” BMO economist Doug Porter noted.

But for the energy component, so-called headline inflation would also be well-anchored below two per cent at 1.8 per cent.

Energy costs were higher across the board last month. Along with gasoline, natural gas rose 9.2 per cent from last year, electricity 6.2 per cent, and transportation costs, which are heavily influenced by gas prices, rose 4.9 per cent.

Costs of vehicles, shelter, food rise

Inflation pressures on most other items measured by Statistics Canada tended to be more moderate. Consumers paid 4.3 per cent more for passenger vehicles; 2.7 per cent more for shelter; 1.7 per cent more for food; and 1.7 per cent more for household operations, furnishings and equipment.

“The annual trend in food prices rose, but will hardly ring any alarm bells,” Porter noted.

Meanwhile, mortgage interest rate costs declined 2.5 per cent in December and clothing and footwear fell by two per cent on an annual basis.

Regionally, the agency said consumer prices rose in every province last month. Ontario continues to have the highest inflation rate in the country at 3.3 per cent.

The muted core rate likely gives the Bank of Canada more leeway in holding steady on interest rates.

After cutting the rate to a record low of 0.25 per cent during the recession, the central bank raised the rate in June, July and September before standing pat in its three policy decisions since then.

In explaining the decision to leave borrowing costs alone for the third time in a row, as expected by the markets, the Bank of Canada said the global recovery is “proceeding at a somewhat faster pace” than policy makers had anticipated last fall, though “risks remain elevated.”

The Canadian economy will grow 2.4 per cent this year and 2.8 per cent in 2012, the central bank said, in a teaser to a full quarterly forecast it will release Wednesday. That compares with an October forecast of 2.3 per cent growth for this year and 2.6 per cent in 2012.

Bank of Canada Governor Mark Carney left his benchmark interest rate at 1 per cent today (18 Jan 2011)

Updated Info:

The Bank of Canada today announced that it is maintaining its target for the overnight rate at 1 per cent. The Bank Rate is correspondingly 1 1/4 per cent and the deposit rate is 3/4 per cent.

The global economic recovery is proceeding at a somewhat faster pace than the Bank had anticipated, although risks remain elevated. Private domestic demand in theUnited States has picked up and will be reinforced by recently announced monetary and fiscal stimulus. European growth has also been slightly stronger than anticipated. Ongoing challenges associated with sovereign and bank balance sheets will limit the pace of the European recovery and are a significant source of uncertainty to the global outlook. In response to overheating, some emerging markets have begun to implement more restrictive policy measures. Their effectiveness will influence the path of commodity prices, which have increased significantly since the October Monetary Policy Report (MPR), largely reflecting stronger global growth.

The recovery in Canada is proceeding broadly as anticipated, with a period of more modest growth and the beginning of the expected rebalancing of demand. The contribution of government spending is expected to wind down this year, consistent with announced fiscal plans. Stretched household balance sheets are expected to restrain the pace of consumption growth and residential investment. In contrast, business investment will likely continue to rebound strongly, owing to stimulative financial conditions and competitive imperatives. Net exports are projected to contribute more to growth going forward, supported by stronger U.S. activity and global demand for commodities. However, the cumulative effects of the persistent strength in the Canadian dollar and Canada’s poor relative productivity performance are restraining this recovery in net exports and contributing to a widening of Canada’s current account deficit to a 20-year high.

Overall, the Bank projects the economy will expand by 2.4 per cent in 2011 and 2.8 per cent in 2012 – a slightly firmer profile than had been anticipated in the October MPR. With a little more excess supply in the near term, the Bank continues to expect that the economy will return to full capacity by the end of 2012.

Underlying pressures affecting prices remain subdued, reflecting the considerable slack in the Canadian economy. Core inflation is projected to edge gradually up to 2 per cent by the end of 2012, as excess supply in the economy is slowly absorbed. Inflation expectations remain well-anchored. Total CPI inflation is being boosted temporarily by the effects of provincial indirect taxes, but is expected to converge to the 2 per cent target by the end of 2012.

Reflecting all of these factors, the Bank has decided to maintain the target for the overnight rate at 1 per cent. This leaves considerable monetary stimulus in place, consistent with achieving the 2 per cent inflation target in an environment of significant excess supply in Canada. Any further reduction in monetary policy stimulus would need to be carefully considered.

“The perceptions don’t reflect the fact that things have been getting better for now a year and a half,” TD chief economist Craig Alexander told a gathering of the Economic Club of Canada in Toronto.

“There’s no question that the recession is over, so how do you actually reconcile the poll results with what the economic forecasters are talking about?”

Canadians list worries over the cost of living as one of their top concerns for the economy in 2011

Pessimistic Canadians

Economists declared the recession had ended in mid-2009 and had managed six quarters of economic growth and recovered all of the jobs lost during the recession. Still, Canadians don’t feel as optimistic.

The poll conducted by Pollara for the Economic Club of Canada suggests that 38 per cent of respondents believed that the Canadian economy would improve over the next year, compared with 54 per cent of those polled in December 2009. Also, some 20 per cent said the economy would worsen in 2011, compared with 14 per cent who felt that way one year ago.

Almost 30 per cent of respondents said the economy is in a state of moderate growth heading into 2011, compared with just 17 per cent last year. But concern over a severe recession occurring has dropped to 10 per cent from 17 per cent.

“Canadians were feeling overly bullish on economic recovery this time last year,” said Michael Marzolini, chairman of POLLARA. “But clearly, these lofty expectations in Canada and around the world have not yet been met, and Canadians are now more measured in their feelings about the economy.”

Cost of living

Among the major economic concerns of Canadians, 78 per cent cited the cost of living; 72 per cent noted the government deficit and national debt; 70 per cent listed having enough money to retire as their chief concern; 69 per cent said health-care costs were their No. 1 concern; 57 per cent responded with value of their investments; and 55 per cent marked their own family debt load as their top priority.

Despite lesser optimism, Canadians are much more confident about the domestic economy than prospects elsewhere. Some 42 per cent of Canadians feel the U.S. economy will actually worsen in 2011, compared with only 19 per cent who feel it will improve. On a larger scale, 43 per cent of Canadians feel the global economy will worsen in the next year, while only 20 per cent expect the global economy to improve.

“Canadians are reflecting, rightly, that the job market isn’t as good as it was when times were good and they say ‘we’re in recession’ because of that, where economists say ‘we’re in recovery’ because we’re not as bad as we were during the recession,” said CIBC chief economist Avery Shenfeld.

Canadians will get a first look at how the economy is faring when Statistics Canada issues its jobs report for December on Friday. Economists expect that the economy created another 20,000 jobs, on top of the 15,200 created during the previous month.

The sale of trucks was down 2.7% with 74,614 units sold in October. Truck sales include vehicles such as sports utility vehicles, vans and minivans. The sale of trucks for personal use has risen steadily over the last year.

Passenger car sales rose for the second consecutive month. In October 59,813 units were sold, an increase of 4.2%. North-American build cars rose 6.8%, whilst cars manufactured overseas rose 1%.

Newfoundland and Labrador saw the highest rise in sales between September and October 2010 with a rise of 4.8%, whilst Saskatchewan saw a decrease of 8.6%.

Compared with the same time last year Prince Edward Island vehicle sales rose 7.1%, but at the other end of the spectrum their neighbours Nova Scotia saw a 14.2% decrease in motor vehicle sales.

In total 134,427 motor vehicles were sold during October 2010 compared with 134,844 in September 2010 and 134,075 in october 2009.