Confidence among Canadian exporters is on the rise again as the U.S. economic recovery gathers momentum.
Export Development Canada’s semi-annual trade confidence index rose to 72.6, up from 70.7 in last fall’s survey.
“Imbedded in these numbers are the good things that are going on in the United States,” said Peter Hall, EDC’s chief economist.
“Folks are seeing that orders are rising and they’re more convinced that this is the real thing,” he added.
Recent indicators suggest the U.S. economy is gaining momentum, though the first quarter was slower than initially believed. The housing sector is coming back, retail sales are strong and the economy is generating jobs at a much faster clip than a year ago.
Eight out of 10 exporters reported either higher or flat orders from U.S. customers, up from 75 per cent last fall, according to the EDC index, due to be released Thursday.
The survey also reflects less concern about both Europe and emerging markets.
Mr. Hall pointed out that Canadian exports have been increasing at an annual rate of 12 per cent over the past six months.
The 72.6 reading is still below the index’s recent peak of 78.8, reached in the spring of 2010. But it’s roughly in line with the average seen from 2003 to 2007 – before the recession.
The increase from last fall cut across virtually all regions and business sectors. The one outlier was Alberta’s oil and gas industry, where confidence was down marginally.
“It’s not a bad reading at all,” Mr. Hall remarked.
He cautioned that the index has been volatile since the recession ended. “That’s a feature of where we are now,” he added.
Other key findings:
A third of all companies reported exporting to new markets within the past two years and half said they plan to do so in the next two years.
The top five new markets identified by respondents were Brazil, China, Germany, Britain and Mexico.
Fifty-five per cent of respondents said they are “very ready” to operate with the Canadian dollar at par with the U.S. dollar. Only 4 per cent said they are not at all prepared.
The survey was conducted in mid to late April and is based on responses from 760 companies.