Canadian consumer confidence continues to fall as inflation sits at its highest level in nearly 40
years.
The “Canadian Confidence Index,” a measure of consumer sentiment based on weekly polling
data, declined for a ninth consecutive week, and reached its lowest level ever outside of an
economic crisis.
Each week, Nanos Research polls 250 Canadians for their views on personal finances, job
security, the economy and real-estate prices.
The gauge fell to 48.3 last week, its lowest level in two years. Since polling began in 2008, the
index has only fallen below 50 during the depths of the COVID-19 pandemic and the 2008-09
financial crisis.
The slump in the Confidence Index has economists worried that Canadian households are
being hurt by rising consumer prices, higher interest rates, and declining housing prices.
Inflation in Canada hit 7.7% in May this year, its highest level since 1983. In response, the Bank
of Canada has initiated one of its most aggressive monetary policy tightening cycles ever,
raising interest rates by more than 1% at its last two policy meetings.
As a result, the number of Canadian households that say their finances are worse today than a
year ago has reached 42%, a record high. And 57% of Canadians say they now expect the
economy to weaken over the next six months, also a record level.
