The quarterly business survey from the Bank of Canada
- This is the highest since 2009
- Overall business outlook +2.9 vs +1.3 prior (third highest ever, highest since 2018)
- Business confidence across all regions has strengthened
- "Most businesses are no longer preoccupied with pandemic-related uncertainty"
- Nearly two‑thirds of firms indicated their sales have reached or exceeded pre-pandemic levels
- Hiring +45 vs +43 prior
- Output prices +45 vs +15 prior
- Investment intentions +40 vs +26 prior
- 55% see inflation running above 2%, which is the highest since 2018
- Full report
This survey is a big factor in driving BOC policy and communication and (as you can see), it's running very strong now.
What's going to worry them most is that the input and output prices in the survey are both at their highest ever:
Here's what the BOC wrote in the survey though. Note that they mitigate some of the price increases or highlight that they're modest.
Many businesses now anticipate that commodity‑related prices (e.g., fuel, building materials, agricultural products) will be the main source of rising cost growth. Several firms, but fewer than in the winter survey, expect elevated shipping and freight fees to remain a source of upward pressure. Other businesses indicated positive pressure on the growth of subcontracting fees. Firms also now expect wages to grow at a faster pace. For some businesses, this follows wage freezes or weak wage growth experienced earlier in the pandemic.Because of improved demand conditions and a desire to rebuild their margins, firms across most sectors intend to increase their selling prices at a greater rate than over the past 12 months, although often from a low level. Indeed, for many businesses, their expected output price increases remain modest. Several firms said they intend to pass cost increases, particularly those related to commodities, on to their customers.
