10/18/2011 10:06 EDT | Updated 12/18/2011 05:12 EST

Canadians' Confidence In Economy Slumps To 2-Year Low


The prospect of the global economy heading back into recession has left Canadians a lot less optimistic about the country's near-term economic prospects, a poll by Nanos Research suggests.

The survey found that the proportion of Canadians expecting a stronger economy in the next six months plummeted to just 16 per cent. That's a startling drop from the 29.2 per cent level recorded in the last survey in June.

Conversely, the proportion of those surveyed who predicted a weaker economy jumped to 38.9 per cent from 23.6 per cent.

Continuing uncertainty over the European debt crisis and the political deadlock in the U.S. appear to be having an effect on consumer confidence in Canada, the research firm said. "These two forces have created a chill effect among consumers in Canada and have contributed to a further erosion of Canadian consumer confidence," president Nik Nanos told Bloomberg.

The Nanos Expectations Index, which looks at consumers' perceptions of economic direction as well as real estate prices, fell to its lowest level since 2009.

Personal finances stable

Even though consumer confidence is flagging, Nanos found that just over half of those surveyed (51.1 per cent) have seen no change in their personal finances in the last year, down slightly from the 55.8 per cent finding in the June survey.

Just over a fifth of Canadians (21.4 per cent) say their finances have improved in the last year, while 26.7 per cent say they've worsened.

Almost half of Canadians (49.1 per cent) said their level of personal debt would stay the same in the next six months, virtually unchanged from the previous survey. Almost three in 10 (29.8 per cent) expected their personal debts would decrease.

Just over half of those polled (52.3 percent) considered their jobs were secure. That was up almost two percentage points from June.

The Nanos findings follows a Bank of Canada survey released Monday that found business executives' confidence in future sales growth was at a two-year low.

The Nanos survey of 1,209 Canadians was carried out between Sept. 25 and Oct. 2. It's considered accurate to within 2.8 percentage points, 19 times out of 20.