Canadians Increasingly Pessimistic About Economy, New Poll Shows
Record Numbers of Canadians Express Economic Pessimism as Financial Strain Increases
A significant surge in negative sentiment toward the Canadian economy has been revealed in the latest reading of the Maru Household Outlook Index (MHOI), with 70 per cent of respondents believing the country’s economic situation is trending in the wrong direction – the highest level recorded since February 2021. The poll, conducted by Maru Public Opinion, points to a deepening financial distress among Canadians, compounded by concerns regarding rising interest rates and broader economic uncertainty. The index currently sits at 84, two points lower than the previous reading, representing the second-worst figure since April 2021 when the index slumped to 83.
The core of the pessimism stems from a sharp increase in reported financial distress. Thirty per cent of Canadians indicated that their personal financial situation is worse than it was the previous month, a five percentage point rise, reflecting a growing struggle for many households. Furthermore, 53 per cent of respondents expressed worry about their day-to-day finances, up four percentage points from the last measurement. A considerable portion, accounting for 23 per cent, revealed an “acute” level of concern regarding their financial well-being. Of those struggling financially, 37 per cent admitted to finding it difficult to make ends meet, with 15 per cent describing the situation as “acute”. The reported hardship extends to housing, with one in four respondents indicating a potential inability to keep a roof over their family’s head within the next two months, marking a substantial six percentage point increase from the prior poll. This figure represents the highest level recorded since July 2020. Adding to the anxieties, 18 per cent confessed they might face defaulting on loan payments or a mortgage within the same timeframe while a similar number—14 per cent—indicated a possible need to downsize to a smaller home to manage costs.
The figures underscore the impact of the Bank of Canada’s monetary policy. The central bank has implemented ten interest rate hikes since March 2022, driving the benchmark overnight lending rate to a 21-year high of five per cent, in an effort to combat inflation. The question remains whether the Bank of Canada will maintain its current approach, considering the potential “collateral damage” of further rate increases. The decision will be pivotal and likely influence the country’s economic trajectory.
Interestingly, the poll revealed a surprising trend: financial distress is no longer confined to younger, lower-income groups. A quarter of those earning $100,000 or more also reported being worse off, highlighting the broad impact of economic headwinds. Within this high-income bracket, 21 per cent stated they may not be able to keep a roof over their heads in the next 60 days, and 14 per cent admitted they could potentially default on loans or mortgages. This revelation indicates a previously underestimated layer of financial vulnerability within the Canadian population.
The Maru Household Outlook Index’s data collection occurred between September 29th and October 1st, utilizing a sample of 1,530 Canadian adults. This sample carries an estimated margin of error of +/- 2.5 per cent, with a confidence level of 19 out of 20. To maintain editorial integrity, Postmedia Network Inc. encourages readers to support our journalism through website bookmarks and newsletter subscriptions. Contributing to this process helps ensure the continued availability of critical business coverage.
