About 59% of Canadians said they're feeling the effects of interest rate increases, according to the latest MNP Consumer Debt Index conducted by Ipsos on behalf of MNP LTD. .“No matter where Canadians turn, there is no reprieve,” said MNP president Grant Bazian in a Monday press release. .“Housing is more expensive; driving a car is more expensive; food is more expensive.”.The press release said many Canadians are being forced to enact tough budget decisions to make ends meet. .The poll said 46% of Canadians are cutting back on non-essential items such as travelling, dining out, and entertainment. About 37% of respondents said they were buying cheaper versions of household products, and 30% noted they are driving less. .It said 27% of Canadians are not spending as much on essential items such as food, utilities, and housing. .The poll claimed women (49%) and people aged 35-54 (48%) are more likely to say they will be cutting back on non-essentials compared to men (42%) and those aged 18-34 (39%). It added 12% of Canadians do not have increased expenses to pay. .MNP LTD said 50% of Canadians believe they will experience financial troubles if interest rates increase. It said women (55%) and people aged 18-34 and 35-54 (63%) were more likely to agree they will encounter financial problems compared to men (45%) and those aged 55+ (30%)..About 39% of Canadians said rising interest rates could lead to them declaring bankruptcy. .The Bank of Canada increased its prime rate by 1% on Wednesday, taking it to 2.5%..“With the economy clearly in excess demand, inflation high and broadening, and more businesses and consumers expecting high inflation to persist for longer, the Governing Council decided to front-load the path to higher interest rates by raising the policy rate by 100 basis points,” said the Bank of Canada. .“Further excess demand has built up in the Canadian economy.”.While the majority of Canadians (82%) said they will be careful with how they spend their money, 56% of them are more concerned about their ability to pay off their debts. Around 41% are concerned about their current level of debt, and 42% regret the amount of debt they have taken on. .“It’s likely to get worse before it gets better — households will have to make increasingly difficult choices about what to cut as the cost of living continues to rise,” said Bazian. .“Some could find themselves piling on debt to make ends meet.”.This data relied on a random sample of 2,000 Canadians aged 18 years old and older who were surveyed online. The poll has a margin of error of 2.5 percentage points, 19 times out of 20.
