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Improved economic expectations and investment climate return
consumer confidence to upward trend, according to RBC CASH
Index
NEW YORK, February 10, 2006 — After beginning
2006 on a down note, consumer confidence rebounded in February,
resuming the positive trend that began in October of 2005,
according to the most recent results of the RBC CASH (Consumer
Attitudes and Spending by Household) Index, which measured
the attitudes of 1,000 Americans this week. Issued today by
RBC Financial Group, the RBC CASH Index for February stands
at 96.1, a considerable increase from 78.2 in January - and
also significantly above the February 2005 level of 79.1.
"Americans have shaken off headline-grabbing layoffs
and returned confidence to the upward trend that began late
last year," said Vincent Boberski, director of Fixed
Income Research for RBC Dain Rauscher. "Significantly
more workers feel secure in their jobs than they did just
a month ago. That means people feel better about their own
financial situations, as well as business conditions in general."
Regarding the long-term outlook, Boberski added, "Widespread
skepticism about where the country is headed makes us cautious,
as we continue to expect a slowdown during the second half
of the year. However, the current investment climate appears
favorable and the labor market as a whole is healthy and poised
for further gains."
RBC's CASH Index is a monthly national survey of consumer
attitudes on the current and future state of local economies,
personal financial situations, savings, and confidence to
make large investments. The Index, which is comprised of four
sub-indexes: RBC Current Conditions Index, RBC Expectations
Index, RBC Investment Index and RBC Jobs Index, is benchmarked
to the 100 reading assigned in January 2002 when it was first
introduced. This month's findings are based on a representative
sample of 1,000 adults polled nationwide between February
6-8, 2006, by survey-based research company Ipsos Public Affairs.
Highlights of the survey results include:
- Confidence in job security improved significantly, with
43 per cent of Americans reporting they are more confident
about their job security than six months ago (compared to
37 per cent in January 2006). Confidence in job security
is traditionally one of the most robust and resilient indicators
of consumer confidence, but despite news of massive layoffs
in the auto and associated industries, concerns over job
security do not appear pervasive in the American public.
The RBC Jobs Index for February stands at 119.3, a major
recovery after two straight months of decline.
- One-quarter (26 per cent) of those surveyed rate their
current local economy as strong, and 28 per cent rate their
current financial situation as strong. As a result, the
RBC Current Conditions Index for February stands at 111.6,
up from 96.5 in January.
- Americans are more bullish on investing in real estate
and the stock market this month, as 44 per cent of respondents
believe the next 30 days will be a good time to buy real
estate, and nearly half (46 per cent) believe the next month
will be a good time to invest in the stock market. As a
result, the overall investment climate has improved significantly
and the RBC Investment Index stands at 101.5, its highest
level in 16 months.
- Fewer than two in ten Americans (14 per cent) expect their
local economies to be weaker six months from now. That's
a sharp reversal from the January reading, as the RBC Expectations
Index stands at 59.4 for February, compared to 33.9 last
month.
- Opinions regarding purchases are somewhat mixed. While
only 35 per cent of those surveyed say they are more confident
in making a major purchase such as a home or a car, 43 per
cent say they are comfortable making other household purchases.
The entire RBC CASH Index report can be viewed at www.rbc.com/newsroom/rbc-cash-index.html.
About RBC Financial Group
Royal Bank of Canada (TSX, NYSE: RY) uses the initials RBC
as a prefix for its businesses and operating subsidiaries,
which operate under the master brand name of RBC Financial
Group. Royal Bank of Canada is Canada's largest bank as measured
by market capitalization and assets and is one of North America's
leading diversified financial services companies. In the United
States, RBC provides personal and commercial banking, insurance,
full-service brokerage and corporate and investment banking
services to about 1.5 million clients through RBC Centura,
RBC Insurance, RBC Liberty Insurance, RBC Dain Rauscher and
RBC Capital Markets. The company employs approximately 70,000
full and part-time employees who serve more than 14 million
personal, business and public sector clients through offices
in North America and some 30 countries around the world. For
more information, please visit www.rbc.com.
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Contact :
Vince Boberski,
RBC Dain Rauscher, (312) 559-1654
Kevin Foster,
RBC Capital Markets, (212) 428-6902
Susan Austin,
The Hubbell Group, Inc. (781) 210-5020
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