Canadians are split on what's causing consumer prices to rise at the fastest pace since 1991, a fact that's raised the prospect of the country slipping into a recession, according to a new Yahoo/Maru Public Opinion poll on inflation.
From gasoline to groceries, Canadian wallets have been pinched as the annual inflation rate climbed to 6.7 per cent in March, the highest level in three decades. According to Statistics Canada, prices rose by 1.4 per cent in March, the biggest monthly jump since Ottawa introduced a federal sales tax 31 years ago.
"There is no clear consensus among Canadians as to what the main cause is for this rapid increase in the cost of living across the country," said Maru executive vice-president John Wright.
The Yahoo/Maru survey polled 1,517 Canadians between April 23 and April 25. It found COVID-related supply chain issues narrowly topped the list of potential causes, with 29 per cent pointing to the pandemic's lasting grip on global trade. This view was most popular in Quebec (35 per cent), and among women (31 per cent), as well as those over 55 years old (33 per cent), and those with the highest levels of education (37 per cent).
A similar number of respondents (28 per cent) chose "profit-taking by companies and speculators" as the chief cause of runaway inflation. This perspective was most widely held in Manitoba and Saskatchewan (37 per cent), and more popular among men (31 per cent), Canadians aged 18 to 34, and those with the lowest incomes and education.
One in five (20 per cent) say they believe businesses have raised prices to make up for slow sales during the worst of the pandemic. This opinion was most popular in Ontario (22 per cent), and Manitoba and Saskatchewan (21 per cent), and more likely to be found among women (25 per cent), those over 55 (21 per cent), and those with lesser income and education, at 22 per cent and 23 per cent, respectively.
Rising commodity prices as a result of Russia's war on Ukraine was cited by 12 per cent of respondents. According to Maru, this belief was held evenly across every socioeconomic demographic, and in every region.
Finally, 11 per cent of respondents say they believe "other factors" are the main cause of rising consumer prices.
Regardless of its origin, the Bank of Canada and the U.S. Federal Reserve are expected to continue hiking benchmark interest rates in a bid to tamp down inflationary pressures. This has raised fears of a recession taking hold in both economies.
"In light of the aggressive monetary policy response needed to curb historically high inflation, markets are increasingly worried about the risk of a recession in Canada," Scotiabank economist René Lalonde wrote in a research note on Thursday.
"We think the risk of a recession remains low at present, as we expect strong growth this year and next in spite of a forecast three per cent policy rate in early 2023."
Jeff Lagerquist is a senior reporter at Yahoo Finance Canada. Follow him on Twitter @jefflagerquist.