As inflation soars and interest rates rise, Canadians are growing increasingly concerned that the economy is sinking into a recession, a new Yahoo/Maru Public Opinion poll has found.
The survey of 1,517 Canadians found that 23 per cent of respondents believe the country will experience a recession in the next three months, while a majority (55 per cent) think it is currently in the midst of one.
This comes as most Canadians reported concern about the state of the economy, with 62 per cent saying they believe it is "moving on the wrong track."
Recession concerns have been on the rise in recent weeks, as central banks around the world try to bring inflation down from some of the highest levels seen in decades via rapid interest rate hikes.
The Bank of Canada is among the central banks trying to bring skyrocketing inflation back to the target range of between one and three per cent, with its next interest rate decision on June 1. The Consumer Price Index (CPI) increased 6.8 per cent on a year-over-year basis in April, driven largely by rising food and shelter prices. With gas prices spiking again this month, economists expect inflation to continue to accelerate, with one economist predicting it could pop by more than 7 per cent.
With fears of a recession looming, Canadians have started to change their spending habits, according to the Yahoo/Maru Public Opinion survey. Slightly more than half (52 per cent) of respondents say they have set stricter priorities and reduced spending in the last month. Those that are most likely to cut back on spending are Albertans (62 per cent), followed by those living in Atlantic Canada (57 per cent), Manitoba and Saskatchewan (53 per cent) and Ontario (52 per cent). Nearly one-third of Canadians (32 per cent) say their financial position has worsened in the last month.
The survey echoes a separate poll, conducted by Nanos Research for Bloomberg News, which found that the number of Canadians who say their finances are worse today than last year has reached 41 per cent. That marks the second-highest reading since 2008.
The survey of 1,517 Canadian adults was conducted between May 20 and May 23 and has an estimated margin of error of +/- 2.5 per cent, 19 times out of 20.
Alicja Siekierska is a senior reporter at Yahoo Finance Canada. Follow her on Twitter @alicjawithaj.