The lazy, hazy, crazy days of summer have been hot across much of Canada and consumer sentiment seems to be wilting.
Recent data from the non-profit research foundation, Angus Reid Institute, suggests three-quarters of Canadians feel now is a bad time to make a major purchase. Cars, trips, renovations and homes are being set aside in favour of essentials like groceries and gas.
Just 15% say now is a good time for a big purchase. That number is half what it was two years ago, in the early days of the pandemic lockdowns.
Other major research and polling firms, like The Conference Board of Canada, Ipsos and Nanos all report consumer confidence that is below long-term averages, and sinking.
Inflation, interest rates and uncertainty appear to have Canadians trying to keep their money in their wallets even though the desire for home ownership remains strong. Instead of entertaining themselves watching a new, big-screen TV, they are watching the Bank of Canada instead.
With the average household owing $1.83 in debt for every $1.00 of disposable income, Canadians are very sensitive to interest rate increases. The Angus Reid research suggests 71% of Canadians are keeping a close, or very close, eye on the central bank’s fight against inflation. Many of them do not like what they are seeing. More than half, 53%, say they do not have confidence the Bank is making the right decisions as it raises interest rates to curb rising inflation.
One third, 33%, indicated they have more faith in the Bank of Canada.