Bank of Canada Survey Finds Widespread Hiring, Investment Plans

OTTAWA--Businesses in Canada say they are planning to increase their investments and hire staff as they deal with continued supply chain disruptions and labor shortages, a Bank of Canada survey found.

The central bank's quarterly business outlook survey, released Monday, found firms' domestic and foreign sales prospects remained strong in the late summer, with businesses that provide in-person services expecting to benefit from easing Covid-19 restrictions and pent-up consumer demand. However, some businesses said ongoing supply constraints could limit their future sales.

Businesses said supply chain disruptions have worsened since the previous quarter and are expected to continue until the second half of 2022, the survey found, longer than previously anticipated. A growing proportion of firms also said that labor shortages are preventing them from meeting growing demand, compared with prior surveys.

Meanwhile, businesses' inflation expectations increased. The Bank of Canada found almost half of businesses now anticipate inflation above 3% over the next two years. The Bank of Canada, which targets inflation at the midpoint of a 1% to 3% range, said recently that the causes of inflationary pressures remain narrow and linked to the circumstances of the pandemic.

The Bank of Canada's next interest-rate decision is due Oct. 27.

Write to Kim Mackrael at kim.mackrael@wsj.com


  (END) Dow Jones Newswires
  10-18-21 1044ET
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