Consumer confidence index in Canada - Data and Analysis (1982-2032)

In 2026, the Index of Consumer Confidence in Canada is projected to increase 24.7% to an index value of 81.6, reflecting a compound annual growth rate of -5.2% from 2021 through 2026. Improving household finances and job security have led the recovery, with the unemployment rate easing to its lowest level in two years by midyear. The Bank of Canada has held its policy rate steady through 2026 following an extended easing cycle, relieving pressure on households renewing mortgages. Gains have been uneven. Higher gasoline prices tied to the war in the Middle East pushed inflation back above target and dragged sentiment to an 11-month low during the spring. Momentum faces a fresh setback late in the year after Washington imposed 50.0% tariffs on a slice of Canadian goods once negotiations collapsed, prompting dollar for dollar retaliation from Ottawa.Consumer confidence has contracted sharply over the past five years. The period opened from an elevated base in 2021, when vaccination campaigns, pent-up savings and generous income supports lifted sentiment to a record high. That optimism unwound quickly through 2022 as new COVID-19 variants, snarled global supply chains and Russia's invasion of Ukraine drove the steepest inflation in four decades. The Bank of Canada's aggressive tightening cycle compounded the strain, lifting debt servicing costs for a household sector carrying near record leverage.Confidence stayed weak through 2023 and 2024 as restrictive interest rates worked through the economy. Waves of mortgage renewals at materially higher rates, falling real income per capita and stubbornly high grocery and shelter costs eroded purchasing power. Confidence slid to its lowest point since the onset of the pandemic in the latter half of 2024.The trade shock defined 2025 and delivered the trough for the period. Tariff threats from the incoming US administration in late 2024 sent the index tumbling in early 2025 to its weakest level in more than a year, with the decline concentrated in expectations for employment and major purchases. Subsequent tariff rounds hit steel, aluminum, softwood lumber and autos, and job loss fears spiked among workers in trade exposed sectors. Federal election uncertainty and a stalling economy reinforced the pessimism. Rate cuts through 2025 and into early 2026 cushioned the blow but could not offset it.