Ongoing supply issues expected to drive prices higher: Bank of Canada survey
Global News
The Bank of Canada's survey of business confidence shows supply chain issues are persisting through the first quarter of 2022, with the war in Ukraine worsening existing issues.
The global supply chain snags that marked the latter half of 2021 have stretched into the new year and have been worsened by Russia’s invasion of Ukraine, according to a Bank of Canada survey released Monday.
Businesses now expect these persistent snags hampering the flow of goods around the world to drive costs higher in the near term, with most believing inflation relief is still years off.
The central bank’s Business Outlook Survey for the first quarter of 2022 showed a “record high” number of companies are now reporting “capacity pressures” tied to supply chain and labour-related concerns.
The Bank of Canada’s Business Outlook Survey polls senior management from around 100 firms representative of the country’s overall economy.
Though the outlook survey was taken in mid-February — before Russia invaded Ukraine — the Bank of Canada followed up with a supplemental survey to gauge the impact of the eastern European conflict on business confidence.
Roughly half of respondents said they expect to be affected by the war, most commonly through higher cost pressures tied to soaring energy and commodity prices.
Firms do continue to expect strong sales growth, the Bank of Canada said, but at a more moderate pace than the past year.