Inflation Worry Deepens Among Canadians in Blow to Central Bank
Asked what they think annual inflation will be in 12 months, a majority of respondents said it would be above the current level of about 7%, according to a survey by Nanos Research Group for Bloomberg News. The median estimate was 8%.
Canada’s inflation rate hit 6.8% in April and is poised to come in higher for May. The data are due three weeks before Governor Tiff Macklem announces the next policy decision on July 13, with markets and economists expecting a third consecutive half-point hike.Article content The hawkish pivot is in large part a confidence-building exercise to convince Canadians that policy makers remain focused on cooling price pressures and bringing inflation back down to the central bank’s target.Article content“High inflation for extended periods can also complicate the bank’s ability to bring inflation back to our 2% target,” Beaudry said. “That’s because inflation can become self-fulfilling if it leads households and businesses to expect higher inflation in the future.
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