Trial now

Marginally Lower In Asia


(H2) Bullish price Structure


Moderna CEO Weighs On Risk


(Z1) Northbound


(Z1) Bullish Focus

MNI: Nearly Half of Canada Firms See 3% Inflation in BOC Poll

MNI (Ottawa)

Supply chain disruptions are driving anticipated price pressures, according to a survey.

Sign up now for free access to this content.

Please enter your details below and select your areas of interest.

Canadian business leaders predicted record inflation over the next two years on snarled supply chains though many see the price pressures as temporary, according to a central bank survey published Monday.

Forty-five percent of respondents said the consumer price index will advance by more than 3% in the Bank of Canada's Business Outlook Survey, and another 42% see prices advancing 2%-3% over that time. Firms also reported that the supply chain issues will persist into the second half of next year.

"Firms intend to continue passing increases in labour and other input costs on to their customers," the BOC's report said. The balance of opinion on more capital investment and hiring rose to records of 46% and 67%, respectively, as firms scramble to meet orders, and a record 65% of firms also said they would struggle to meet unexpected demand.

The BOC's quarterly survey of consumer sentiment also showed record inflation expectations of 3.72% a year from now. The BOC targets inflation in the middle of a 1%-3% band, and investors have been betting Governor Tiff Macklem may raise interest rates before his forward guidance for the right conditions to be in place in the second half of next year.