Lower oil prices, market volatility to continue to weigh on Canada’s business sentiment

Canada's small business confidence for February did not register much of a change. The CFIB Business Barometer Index rose by 0.3 points t o 54.7 in the month. The index continues to be around the lowest levels observed since the crisis of 2009, and is over 12 points lower than most recent peak that was seen at the end of 2014.

Confidence amongst oil-producing regions continued to fall. In the regions of Saskatchewan and Newfoundland and Labrador the index declined by nearly 10 points to 52.4 and 53.5 respectively. The index continued to be the weakest in Alberta, declining by 2 points to 26.7. Meanwhile, regions of Prince Edward Island, Quebec and Ontario recorded gains, where the index reached 65.5, 66.3 and 60.8 respectively.

Since the collapse of oil prices in mid-2014, small business confidence has been lower. The confidence continues to remain weak amidst the lower oil prices, sharp movements in exchange rate, continuous volatility in equity markets and current concerns regarding the global growth. These factors, along with the lengthy adjustment process that is underway in the Canadian economy will continue to drag the business owners' confidence going forward.