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Shoppers feeling frugal amid debt, global woes
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The Toronto Star
With Christmas less than two weeks away, Canadians are still in a frugal mood, the latest surveys of shoppers’ intentions reveal.
Only 6 per cent of Canadians say they plan to spend more on gifts this year than last year, while 41 per cent say they plan to spend less, an Angus Reid Public Opinion poll shows.
The rest, 52 per cent, say they plan to spend about the same amount as last year.
“I see lots of people shopping. I don’t see lots of people carrying bags. What that tells me is people are being a little bit more careful,” said Ken Wong, a professor with Queen’s University’s School of Business. “I think you’re going to see people giving fewer gifts, maybe spending a little more time thinking about what they’re giving. Certainly I don’t see any reason to believe the fact that it’s Christmas is making people any less value conscious than they’ve been since the recession.”
The Angus Reid poll, conducted the week of Nov. 21, comes on the heels of more warnings Canadians are already carrying worrisome levels of household debt.
The average ratio of debt to personal disposable income is now 152.98, Statistics Canada said Tuesday. Households with high debt loads are move vulnerable to unexpected events, such as a job loss or interest rate hike.
Canadians feel relatively optimistic about the domestic economy, but the bad news out of Europe and the U.S. is dampening their spirits, a separate report released Wednesday said.
Canadians say they’re worried about their job prospects, personal finances and whether it’s wise to spend money, according to a survey by Nielsen, a global leader in market research.
Canadian consumers’ confidence fell in the third quarter to 96 points after fluctuating between 99 and 102 points for the past 18 months, Nielsen found. It’s now at the same level it was in the third quarter of 2008.
“We’ve been on a roller-coaster ride, with a lot of ups and downs and screaming along the way and the ride is not over yet,” said Carman Allison, Nielsen’s director of consumer insights. “We’re about to hit another turn.”
The Nielsen survey was conducted in late August and early September as the debt crisis in the European Union was heating up.
Retail sales in Canada are forecast to rise about 2.5 per cent this holiday season, according to an earlier report published by BMO Capital Markets. The forecast excludes cars and gas.
That’s slower than last year’s 3.1 per cent rise and also below the historic average of 4.6 per cent, BMO said.
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