The Bank of Canada issued a report today, Friday, highlighting business outlooks in the country, where the results showed the ongoing negative state of the Canadian economy. The data indicates that business expectations remain negative, reflecting widespread weakness in economic activity.

Despite this, the survey showed that demand remains weak, leading to excess capacity in firms. However, prices recorded a continued slowdown, but the decline was minimal compared to the previous quarter.

In this context, companies reported a slowdown in sales growth due to previous inflation and rising interest rates, which negatively affected consumer budgets. Nevertheless, sales expectations improved slightly this quarter, as companies hope for a possibility of interest rate cuts.

The survey also indicated an improvement in the labor shortage situation, as few companies reported facing some challenges in this regard. However, in contrast, investment and employment intentions remain weak, indicating a cautious stance among businesses in making new decisions.

On another note, wage growth is expected to gradually slow down, which could affect individuals' purchasing power. Companies also anticipate a slowdown in input growth and selling prices, which may impact profit margins in the future.

Finally, inflation expectations remain within the Bank of Canada's target range across all horizons, reflecting relatively stable inflationary pressures and providing a positive signal to the markets.