Businesses and consumers are expecting inflation to slow faster than they previously thought — but as high-interest rates weigh on the economy, they’re also adjusting their finances to account for the slowdown.

That’s according to the Bank of Canada’s first-quarter business outlook and consumer expectations surveys, released earlier this week.

The central bank is currently projecting inflation to fall about three per cent by mid-year and back down to two per cent in 2024.

It aggressively started raising interest rates starting in March 2022 to clamp down on rapidly rising prices. It is currently holding its key interest rate steady at 4.5 per cent and doesn’t anticipate raising it again, so long as inflation cools fast enough.

But as Anne Gaviola reports, economists’ opinions on whether Canada’s economy is headed for a hard or soft landing are mixed.

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