Canadian small firms see prices rising 4% over the next year, slowing again from a record of 4.9% set in April while still double the central bank's inflation target.
The Canadian Federation of Independent Business survey published Thursday also showed expected pay increases moderating to 3.1% from a record 3.6% earlier this year. The Bank of Canada has led the G7 in rate hikes this year and economists see the 3.25% rate climbing another 50bps at its Oct. 26 decision.
The Bank will keep hiking to make sure inflation returns to target even if there's a recession, an academic adviser has told MNI. (See: MNI INTERVIEW: BOC To Follow Through Even If Recession- Tombe)