BoC Business Outlook Survey - Spring 2017: Hiring intentions remain positive overall

According to the Bank of Canada, the results of Business Outlook Survey - Spring 2017 reflect signs of a further strengthening of domestic demand following overall subdued activity over the past two years. This outlook is supported by foreign demand and an expected rebound in activity in energy-producing regions.

Overview as seen in the official report:

• After a period of weakness, firms expect some increase in sales growth in light of improving indicators of domestic sales. Businesses in energy-producing regions perceive that a recovery is under way.
• Export prospects continue to support the outlook despite elevated uncertainty about the impact of potential US policy changes, notably corporate tax cuts and protectionist measures.
• Although many firms expect additional spending to be modest, intentions to increase investment have become more widespread, driven by strengthening demand. Hiring intentions remain positive overall.
• Pressures on capacity are still modest as excess capacity persists, notably in the Prairies. Firms expect a gradual tightening in capacity along with firming demand. Indicators of labour shortages suggest that labour market slack remains but is no longer widening.
• Firms anticipate little momentum in input and output prices because of still-important competitive pressures. Inflation expectations remain concentrated in the lower half of the Bank’s inflation-control range, although they have edged up marginally.
• Most firms reported no change in the terms and conditions for obtaining credit, and access remains easy or relatively easy overall.
• Taken together, the results suggest a modest recovery in business sentiment after a two-year period of weakness, as summarized by the Business Outlook Survey indicator