The belief that prices will keep rising can become self fulfilling as markets react to public expectation. To try and put an end to that, the Bank of Canada increased interest rates by 75 basis points Wednesday.
"Surveys suggest that short-term inflation expectations remain high," the Bank of Canada stated in its news release. "The longer this continues, the greater the risk that elevated inflation becomes entrenched."
Rising inflation has been the story of the summer, with fuel costs and global supply chain disruption causing the Consumer Price Index to reach 8.1% in June. Since then, the CPI has dropped though other indicators remain concerning.
To help understand what inflation and interest rates mean for Greater Victoria businesses, check out our special expert panel facilitated by Chamber CEO Bruce Williams.