National consumer confidence dipped in the second quarter of 2010. According to the Conference Board of Canada’s index of consumer confidence, consumer sentiment lost some ground after having increased in the first quarter, and is now roughly back on par with levels reported at the end of last year. The decrease in confidence reflects weaker outlooks for household budgets and employment, and less enthusiasm about making major purchases.

The balance of sentiment about making major purchases, such as a home or a car, edged into negative territory in the second quarter of 2010. A negative balance of sentiment means more survey respondents said it was a bad time to buy a big-ticket item, such as a home or car, than said it was a good time to do so. This indicator is an important factor underlying the housing market.

The balance of sentiment about job growth prospects was down compared to the first quarter, but was still more positive than in any other quarter since the third quarter of 2007.

The balance of sentiment on the outlook for household budgets was also down in the second quarter, but nevertheless remained positive. A positive balance of opinion means more households said they expect their household budget to improve in the next six months than said they think it will worsen. The quarter-over-quarter decline was largely due to downbeat responses from consumers in British Columbia and Ontario, where the HST comes into effect on Canada Day.