A quarter (27%) of Canadians are cutting back their spending on necessities such as food,
utilities and housing as inflation pushes the cost of living higher, according to a new survey by
MNP Consumer Debt.
Another 37% of Canadians said they’ve begun buying cheaper versions of necessary products,
and nearly half (46%) have cut back on non-essentials such as travel, eating out in restaurants,
and entertainment.
Sixty percent of people said they’re feeling the impact of higher interest rates, a seven-
percentage point increase from a similar survey conducted last quarter.
To get inflation under control, the Bank of Canada has been raising interest rates. The bank rate
now sits at 1.5% and markets are pricing in a three-quarter-point hike at the central bank’s next
meeting on July 13.
Half of respondents (50%) in the MNP survey said that if rates continue to increase, they will be
in financial straits. Almost a quarter of respondents said they are not prepared to deal with an
interest rate increase of one percentage point.