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Inflation Expectations Hit Record in Bank of Canada Surveys

  • 78% of businesses expect CPI to exceed 3% over next two years
  • Markets see Macklem hiking by 75 basis points this month
Tiff Macklem speaks during a Bank of Canada news conference in Ottawa on April 13.

Tiff Macklem speaks during a Bank of Canada news conference in Ottawa on April 13.

Photographer: Justin Tang/Bloomberg
Updated on

Inflation expectations over the next couple of years have hit at a record in Canada, a worrying development that will stoke bets of more aggressive interest rate hikes.

The Bank of Canada’s quarterly surveys of executives and consumers released on Monday show the price pressures that have brought inflation to four-decade highs are expected to persist for longer than previously thought, as the country faces tight labor markets and companies get hit by rising input costs.