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Blog by Kevin Wong

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BC Commercial Leading Indicator Pauses in Q1

Vancouver, BC – May 31, 2011. The British Columbia Real Estate Association (BCREA) index of Commercial Leading Indicators (CLI) was virtually unchanged in the first quarter of 2011, albeit down 0.1 points to 108.6 from 108.7 in the fourth quarter of 2010. This is the first decline registered by the CLI in almost two years.

The CLI peaked at a level of 115.5 in the second quarter of 2007 before the onset of the financial crisis pushed it to a low of 97.7 in the first half of 2009. At its current level, the CLI is 6 per cent below its peak, but still relatively strong compared with past levels of the index.1 The pause in the CLI in Q1 is largely attributable to unexpectedly weak employment to begin the year as well as softer retail sales activity. However, this weakness was largely offset by very strong provincial manufacturing activity as well as a high degree of liquidity in financial markets.

“The BC economy lost a little momentum in the first quarter of the year,” said Brendon Ogmundson, BCREA Economist. “While the CLI did decline slightly to begin 2011, the underlying trend in the index remains very strong and continues to signal a robust environment for commercial investment and activity this year.”

The full BCREA Commercial Leading Indicator index is available at: www.bcrea.bc.ca/economics/CLIReport.pdf.

1 The historical values of the CLI have been revised to reflect updates made in February to Statistics
Canada’s industry labour force estimates.