Canadians’ financial confidence stabilizing, but recession fears persist: survey

With price pressures cooling this year, the financial confidence of Canadians is stabilizing. But trust in the economy remains shaky, according to a survey conducted by Ipsos. 

The 2024 IG Wealth Management Financial Confidence Index mirrored last year’s score of 50. That’s down one point from 2022 and seven points from 2021.  

The index is based on an online survey of 2,001 respondents, fielded from Sept. 20 to Oct. 1. The results come on the heels of a Statistics Canada report that the country’s inflation rate ticked back up to 2% in October. 

“While the Index has stabilized since the pandemic, there’s still a clear sense of anxiety among Canadians as we head into 2025,” said Damon Murchison, president and CEO with Winnipeg-based IG Wealth Management, in a release Thursday.  

“This isn’t surprising – over the last year, Canadians have had to deal with political uncertainty, a higher interest rate environment, a rising cost of living and spiraling housing costs.” 

The survey revealed that there is growing optimism about inflation, with more believing it will stabilize or decrease than did a year ago. Thirty-nine per cent of respondents said they expect Canada’s inflation rate to stabilize, up from 32% who shared this sentiment in 2023. And 10% said they expect the inflation rate to decrease, up from 6% last year.  

At the same time, the portion of Canadians expecting inflation to increase fell, from 49% in 2023 to 38% this year.

Fears of a recession persist, although they have eased up, IG said.  

Nearly half of respondents said they believe that Canada is currently in a recession, down from 60% who expressed this belief in 2023. And 54% said they believe that Canada is heading into a recession in 2025, down from 68% a year ago.  

Nearly seven in 10 respondents said they believe economic conditions in Canada remain poor, while 63% of respondents said they don’t believe financial authorities have the situation under control. 

The top financial concerns for 2025 were rising food prices, being able to maintain one’s current standard of living and an increase in the cost of housing, the survey revealed.   

While trust in the economy is stable nationally, it is trending downward in Quebec and among younger and lower income Canadians, IG said.   

By region, residents of British Columbia had the highest level of financial confidence, scoring 55 in the index. The least optimistic region was Atlantic Canada, which had a score of 48.

Respondents with a financial advisor scored a confidence level that was 15 points higher than those without, the survey found.