OTTAWA — Bankruptcies tumbled and Canadians were buying more homes and cars this fall as indications mounted that the economy has finally shifted into a higher, forward gear.
Fresh economic data released Tuesday for the October-December quarter still in progress was almost universally positive, and strongly so, say economists.
The most dramatic news had to do with Canadians’ finances. The Office of the Superintendent of Bankruptcy reported consumer bankruptcies fell a record 28.4 per cent in October, although some of fall-off could be attributed to changes in filing costs that persuaded Canadians to declare the previous month.
Also on the positive side was a 3.5 per cent increase in new vehicle sales in October compared with September, and a whopping 73 per cent jump in the sale of existing homes via the Multiple Listing Service in November, putting activity near the pre-recession levels of November 2007.
“As we predicted last April, the rebound in resale housing activity led the overall Canadian economy out of recession,” said Dale Rippinger, president of the Canadian Real Estate Association.
Statistics Canada said Tuesday its composite leading index — a broad indicator of economic activity — rose by 1.3 per cent in November, equalling the biggest move of the past six straight increases.
Also encouraging was that growth was widespread. For the first time in over two years, none of the 10 components that make up the index were negative.
The Bank of Canada also signalled improving conditions, announcing late Tuesday afternoon it was withdrawing some of its extraordinary funding facilities, and making them available monthly rather than bi-weekly. The changes take effect Jan. 19.
The sole down signal involved labour productivity, which fell 0.2 per cent, but that was for the third quarter, when growth was halting.
Taken in conjunction with the previously reported 79,000 jobs gain for November, analysts say Canada’s economy appears to be making up for the disappointing performance of the third quarter, when it eked out a slim 0.4 per cent advance.