Consumers continued to cite tariffs and trade tensions as the top factor affecting inflation (Chart 2). Respondents were somewhat more likely to cite tariffs and trade tensions after trade talks between Canada and the United States broke down. In follow-up interviews, many consumers described how tariffs were raising prices of everyday purchases.
Energy prices were also still widely cited as a source of inflation, although fewer respondents mentioned them than in the previous quarter. Most consumers believe the war in the Middle East will raise inflation over the next 12 months. In follow‑up interviews, several respondents linked the conflict to concerns about higher gasoline prices and their effects on other goods and services. As one respondent stated, “I think anything that happens [in the Middle East] will affect economies worldwide and trickle all the way down to the local economy where I live…mainly [through] oil prices. And when you’re affecting oil prices, that, again, trickles to groceries because, obviously, you need oil to move groceries around.”
