Consumer confidence in free-fall in Canada amid tariffs and cost of living, survey finds

Recent data from the Bank of Canada has shown that consumer confidence in Canada is in a tailspin. 

Based on the recently released Canadian Survey of Consumer Expectations (CSCE), Canadians with purchasing power are holding off on making any substantial financial moves due to the country’s economic fragility. 

Primary stressors include the overall cost-of-living crisis, inflation, tighter credit options, and the on-and-off nature of the ongoing tariff war with the U.S. launched by the Trump administration. 

Beyond anxieties dictated by the invisible hand of the market, lingering fears around job loss remain at the front of many Canadians’ minds as well. 

A key demographic maneuvering around this labour market, according to the survey, is young Canadians entering the workforce, as they cited higher concerns around job loss. 

“Tariffs are impacting my job a little bit. They are affecting my industry a lot, and many companies are laying off their employees,” stated an anonymous respondent alongside the data. 

According to the CSCE, at the start of 2025, nearly 60 per cent of workers employed by companies that rely on trade with the U.S. were under the impression that they had little job security. 

That number has since gone down in the second fiscal quarter of 2025, according to the Bank of Canada. However, it is still sitting at nearly 50 per cent. 

As for spending habits across the board, most Canadians are keeping their purse strings tight, as they anticipate the trade conflict to continue to impact the cost of goods and services. 

Concerning national spending habits on discretionary goods, such as furniture, appliances, dining out, and vacations, they remain frozen for most Canadians until the market course corrects. 

Additional changes in habits also reveal that 60 per cent of national consumers plan to increase their spending on domestic goods, and about one-third of those who can afford a vacation a planning on doing so domestically. 

However, there is a cut-off point, as the CSCE indicated that while national attitudes towards domestic spending have increased, the affordability of certain goods manufactured internationally is still dictating what gets purchased at check-out. 

“We have all these various pressures now in our communities to Buy Canadian, but ultimately, I’m going to do what works for my wallet. So, whether that’s a Canadian brand, whether that’s an American brand, I buy what works for my budget,” said another survey respondent. 

As for the rest of 2025, consumer confidence is not projected to improve, as data pointed to a general national consensus that tariffs will continue to sustain a market hostile to the average consumer, with most anticipating an unstable economy for the next five years. 

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