MNI DATA IMPACT: BOC Survey Shows Modest Sales & Inflation>

By Greg Quinn and Anahita Alinejad

     OTTAWA (MNI) - The Bank of Canada's business conditions survey 

showed modest prospects for sales growth and inflation, adding to 

evidence the economy is resilient amid global trade tensions before the 

Oct. 30 interest-rate decision. 

     The balance of opinion on future sales growth was 23 in the third 

quarter, matching the previous period that was the highest in two years. 

The measure subtracts the share of respondents seeing a slowdown from 

those calling for faster gains. 

     Most investors have recently dropped calls for an interest-rate cut 

this year as other reports show the strongest job market in decades and 

signs GDP growth could be faster than expected in the third quarter. 

Bank of Canada Governor Stephen Poloz has held the rate at 1.75% and 

officials have said the economy remains near full capacity with 

inflation close to their 2% target.

     The overall indicator for the Business Outlook Survey climbed to 

0.4 in the third quarter, following two previous declines. The second 

quarter figure was revised to -0.1 from 0.2. 

     Investment plans that have lagged the rest of the economy picked 

up, with the balance of opinion rising to the highest in a year at 28 in 

the third quarter from 20 in the second quarter.

     Weak spots did appear in the report. The balance of opinion on 

hiring fell to 31 from 36, the lowest in three years. The share of 

executives seeing the inflation rate at or below the BOC's 2% target 

over the next two years remained 66%. 

     The BOC surveyed about 100 business leaders between Aug. 20 and 

Sept. 13. The companies are chosen so that they represent the 

composition of gross domestic product. 

- MNI Ottawa Bureau; +1-613-314-9647; greg.quinn@marketnews.com

     [TOPICS: M$B$$$,M$C$S$]