National Household Spending Cools
Index of Consumer Spending
The Index of Consumer Spending (ICS) averaged 114.3 points in December 2023, a 2.9‑point drop from November (the month of April 2022 = 100).
- The ICS drop parallels the year prior, with both years having an increase in November followed by a pullback in December.
- Preliminary data for January showed spending declines across all the provinces. This is expected, as spending is typically restrained in the first couple of months following the holiday season as consumers smooth out spending.
- Inflation increased in December, reaching 3.4 per cent year-over-year. The largest contributors to inflation’s increase were airfares, fuel oil, passenger vehicles, and rent.
- Despite consumption lowering, consumer confidence in December saw a marked improvement. This was largely a shift away from negative responses toward neutrality, possibly indicating that consumers’ expectations for the economy are settling.
- Consumer spending is likely to improve mid-year when interest rate cuts begin and households become more optimistic about the economy.
- Alberta was the only province to see an ICS increase in December. Part of this could be pent‑up spending from new residents. Alberta’s population rose 3.8 per cent in 2023, tied with Prince Edward Island for the strongest growth in the country.
Alberta
ICS increased 1.1 points.
Alberta’s revised December ICS shows a small increase from 117.3 points to 118.4 points. Preliminary data for January (up to January 6) showed the province falling to 91.6 points.
British Columbia
ICS slid 0.4 points.
British Columbia’s revised December ICS dropped to 109.7 points. Up to January 6, preliminary data shows the province declining further to 89.4 points.
Manitoba
ICS decreased 1.5 points.
Manitoba’s revised December ICS fell to 124.1 points. Preliminary January data (up to January 6) showed the province falling further to 94.7 points.
New Brunswick
ICS dropped 2.3 points.
New Brunswick’s revised December ICS dropped to 119.2 points. January preliminary data (up to January 6) indicated the province continuing to decline to 88.5 points.
Newfoundland and Labrador
ICS declined 0.5 points.
Newfoundland and Labrador’s revised December ICS saw a minor decrease to 124.5 points. January preliminary data (up to January 6) showed the province decreasing further to 94.5 points.
Nova Scotia
ICS fell 4.5 points.
Nova Scotia’s revised December ICS decreased to 130.1 points. This still leaves it as first in terms of ICS scores. Preliminary data for January (up to January 6) showed the province continuing to decline to 94.5 points.
Ontario
ICS decreased 5.9 points.
Ontario’s revised December ICS fell to 107.0 points. However, January preliminary data (up to January 6) showed the province retreating to 84.0 points.
Prince Edward Island
ICS decreased 3.4 points.
P.E.I.’s revised December ICS has the province sliding to 127.0 points. January preliminary data (up to January 6)showed the province continuing this momentum and falling to 87.5 points.
Quebec
ICS fell 1.6 points.
Quebec’s revised December ICS fell to 128.9 points. Preliminary data for the month of January (up to January 6) showed the province’s average decreasing to 98.5 points.
Saskatchewan
ICS had a small drop of 1.2 points.
Saskatchewan’s revised December ICS dropped to 109.0 points. This marks six consecutive declines for the province. January preliminary data (up to January 6) showed the province posting seven months of decline, dropping to 83.5 points.
Northwest Territories
ICS shrunk 2.9 points.
The Northwest Territories’ revised December ICS dwindled to 114.5 points. We expect this to continue in January. Preliminary data, up to January 6, showed the territories falling to 95.4 points.
Nunavut
ICS fell 13.0 points.
Nunavut’s revised December ICS showed the territory experiencing the largest ICS point drop, falling to 97.7 points. We see this continuing into January, with preliminary data, up to January 6, indicating another decrease of 18.3 points.
Yukon
ICS dropped 8.1 points.
Yukon’s revised December ICS fell to 106.2 points. This marks five consecutive monthly declines. We expect this trend to continue into January, as preliminary data (up to January 6) showed the territory dropping again to 87.5 points in its ICS.
Preliminary data for January showing a decline is expected, as spending is typically restrained in the first couple of months following the holiday season as consumers smooth out spending.
Powered by Moneris Data Services
The Index of Consumer Spending is powered by exclusive consumer transaction data provided by Moneris Data Services. Moneris is Canada’s number one payment processor with over 3.5 billion transactions spanning more than 325,000 merchant locations. Our index tracks incremental changes in net transaction volume month-over-month from a set starting point (April 2022 = 100), enabling us to gauge economic activity levels across the country and provide insights into how the Canadian economy is performing coast to coast.
Updates on this index will be released monthly.
The Index of Consumer Spending’s (ICS) methodology has been revised for releases from January 2024 onwards. The ICS no longer tracks the weekly year-on-year changes in consumer spending. Instead, the ICS now tracks the incremental changes in net transaction volume month-over-month, from a set starting point (April 2022 = 100).
Disclaimer: Forecasts and research often involve numerous assumptions and data sources and are subject to inherent risks and uncertainties. This information is not intended as specific investment, accounting, legal, or tax advice.