Highlights of the Bank of Canada's Q3 2018 business outlook survey

  • Prior future sales were +6%
  • Widespread reports of better sales indicators for domestic and foreign customers
  • Capacity pressure fell slightly but pressures remain elevated
  • Labor shortage indicators point to tighter labor market, firms say shortages more intense
  • Investment intentions rebound to high level
  • All interviews conducted before USMCA trade deal
  • Majority see strong US demand in coming year
  • Firms expect input and output prices to grow at faster pace
  • Full report

Survey data:

  • Overall business outlook survey 2.8 vs 3.1 prior
  • Investment intentions +33 vs +17 prior
  • Hiring plans +39 vs +51 prior
  • Capacity pressures +56 vs +57 prior
  • Labor shortage +37 vs +34

Separately, the senior loan officer survey was at -10.9 from -8.9.

Overall, these are bullish headlines for the Canadian dollar. The BOC has been waiting for this kind of jump in investment. The critical deal is that this was before the NAFTA deal, so it's only going to improve.