Over 60% of Canadians don't think inflation is going away any time soon.
Catch up: Consumer prices saw a 4.7% year-over-year increase in October, up from 4.4% in September. It's the highest annual increase in nearly 20 years.
What happened: Nanos found that 63.5% of Canadians don't think inflation will return to ‘normal levels,’ which the Bank of Canada defines as somewhere between 1% and 3%..
- The findings are in line with results from Bank of Canada’s survey. The central bank reported that, for the most part, Canadians think high inflation will stick around until supply chain issues are resolved.
Why it matters: Expectations about inflation have a real impact on people’s financial decisions. If businesses think high inflation will stick around, they will be more likely to raise prices, while workers will press harder for pay raises. Both of those factors can kick off an inflationary spiral in which expectations of higher inflation become a self-fulfilling prophecy.