Business
Bank of Canada Study Confirms Collapse in Consumer Confidence Amid Trade War Fallout
They chased applause at climate conferences while dismantling the industries that built this country. They ignored working Canadians, sabotaged our energy sector, and hollowed out our economic defenses in the name of “progress.”
A new Bank of Canada report, yes, that Bank of Canada, just confirmed what millions of working Canadians already feel in their bones: the economy is unraveling. Consumer sentiment, the baseline mood of the average Canadian family, has collapsed. And what triggered this historic plunge? Not inflation. Not interest rates. Not even Pierre Poilievre. No—it was Donald Trump.
According to the report, which was quietly released this month, it all started on February 1, 2025. That’s when former President Trump signed an executive order slapping massive tariffs on Canadian exports, steel, aluminum, energy, potash, lumber. You name it. Up to 35% tariffs. And then, because he’s Trump, he doubled down, casually suggesting in speeches that Canada should just become the 51st state. That’s not a joke. That’s annexation rhetoric.
And here’s the kicker, the numbers don’t lie. The Bank of Canada developed a new tool, the so-called CSCE Indicator, to measure consumer expectations. It tracked 2,000 households in real time, right as the trade war ignited. And what did they find? A total wipeout of all economic optimism from 2024. Jobs? Vanishing. Spending intentions? Cratering. Financial outlook? Bleak.
So here’s what we now know, and it’s not a guess. According to their latest report, Canadian consumer sentiment has collapsed. Not dipped. Not softened. Collapsed. Across the board.
They tracked three critical things: how people feel about their financial health, their job security, and whether they’re planning to spend money. Every single one fell off a cliff. The number of Canadians who believe they’ll be worse off financially next year? Surging. The odds that someone thinks they’ll lose their job? Skyrocketing—especially in regions that actually produce things, places that export goods, like steel, aluminum, and lumber. And major purchases? Cars, homes, furniture? Forget it. People aren’t buying. They’re holding their breath.
And here’s where it gets truly damning. This decline—this emotional and economic freefall—can’t even be explained by the usual suspects. Not inflation. Not unemployment. The Bank of Canada ran the numbers, built a full regression model, and what they found was a massive unexplained drop—a “residual” in economist speak. Translation: this isn’t about what’s happening right now. It’s about what people believe is coming next.
And what’s driving that fear? The answer is plain. A trade war launched by a former U.S. president, and public threats—threats—to annex Canada.
A very large portion of this crisis is the fault of the Liberal Party of Canada. That’s not a talking point—it’s a fact. It’s a fact backed by years of missed opportunities, ideological sabotage, and deliberate inaction by two successive Liberal regimes. And now the consequences have arrived, right on schedule.
Let’s be clear. This didn’t start with Trump’s tariffs. This started long before, when Justin Trudeau, and now his heir Mark Carney, decided that building energy infrastructure was just too messy, too politically inconvenient. For nearly a decade, the Liberals rejected every opportunity to make Canada energy independent. Northern Gateway? Cancelled. Energy East? Killed off. Teck Frontier? Abandoned after the government strangled it in red tape. Trans Mountain? Purchased with your tax dollars, then stalled into irrelevance. Every time a project came forward that could have helped this country get oil and gas to global markets, the Liberals caved to foreign-funded environmental groups and elite climate activists with Ivy League degrees and no skin in the game.
They had no vision—none—for a national energy corridor. They didn’t want one. A pipeline that could move Alberta crude to tidewater, or LNG from B.C. to the Atlantic, was dismissed as a relic of a bygone era. It wasn’t woke enough. Instead, they chose Paris climate targets, photo-ops with Greta Thunberg, and empty moral lectures at Davos. The result? When America decided to weaponize energy policy and slap tariffs on Canadian oil and gas, we had no fallback. No leverage. No global customers. Just bottlenecks and apologies.
And then there’s the LNG disaster. Remember when Deputy Prime Minister Chrystia Freeland said there was “no business case” for LNG on the East Coast? She wasn’t alone. Her former Natural Resources Minister, Jonathan Wilkinson, said the same thing. No business case. This, as Qatar signed over $60 billion in LNG deals with Europe. As the United States became the largest LNG exporter on Earth. As Germany, desperate for alternatives to Russian gas, pleaded with Canada to send help. We said no. Not because we couldn’t do it. But because the Liberals didn’t want to. It wasn’t aligned with their green ideology. It would offend the climate lobby. And so they let the opportunity pass.
And this—this is exactly what happens when you let a part-time drama teacher run a G7 country like it’s a college theater troupe. This is what Liberal governance looks like in practice: performative, reckless, and utterly disconnected from the real world. They chased applause at climate conferences while dismantling the industries that built this country. They ignored working Canadians, sabotaged our energy sector, and hollowed out our economic defenses in the name of “progress.”
And now? Now we’re supposed to hand the firehose to the very people who started the fire. The same elites who told us there was “no business case” for LNG. The same crowd who canceled pipelines, ignored warnings, and left us totally exposed to a geopolitical and economic assault.
It’s 2025. The country is staggering. And the architects of this collapse—the Trudeau-Carney Liberals—have the audacity to ask for our trust again. They want more time. More power. More control.
No. They’ve had a decade. They lit the match, doused the economy in kerosene, and now they’re pretending they smell smoke for the first time.
Canadians shouldn’t fall for it. We don’t need more empty virtue signaling. We need competence. Backbone. And leadership grounded in reality—not staged in front of a mirror.
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The Justin Trudeau and Jagmeet Singh charges of “greedflation” collapses under scrutiny.
“It’s not okay that our biggest grocery stores are making record profits while Canadians are struggling to put food on the table.” —PM Justin Trudeau, September 13, 2023.
A couple of days after the above statement, the then-prime minister and his government continued a campaign to blame rising food prices on grocery retailers.
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The line Justin Trudeau delivered in September 2023, triggered a week of political theatre. It also handed his innovation minister, François-Philippe Champagne, a ready-made role: defender of the common shopper against supposed corporate greed. The grocery price problem would be fixed by Thanksgiving that year. That was two years ago. Remember the promise?
But as Ian Madsen of the Frontier Centre for Public Policy has shown, the numbers tell a different story. Canada’s major grocers have not been posting “record profits.” They have been inching forward in a highly competitive, capital-intensive sector. Madsen’s analysis of industry profit margins shows this clearly.
Take Loblaw. Its EBITDA margin (earnings before interest, taxes, depreciation, and amortization) averaged 11.2 per cent over the three years ending 2024. That is up slightly from 10 per cent pre-COVID. Empire grew from 3.9 to 7.6 per cent. Metro went from 7.6 to 9.6. These are steady trends, not windfalls. As Madsen rightly points out, margins like these often reflect consolidation, automation, and long-term investment.
Meanwhile, inflation tells its own story. From March 2020 to March 2024, Canada’s money supply rose by 36 per cent. Consumer prices climbed about 20 per cent in the same window. That disparity suggests grocers helped absorb inflationary pressure rather than drive it. The Justin Trudeau and Jagmeet Singh charges of “greedflation” collapses under scrutiny.
Yet Ottawa pressed ahead with its chosen solution: the Grocery Code of Conduct. It was crafted in the wake of pandemic disruptions and billed as a tool for fairness. In practice, it is a voluntary framework with no enforcement and no teeth. The dispute resolution process will not function until 2026. Key terms remain undefined. Suppliers are told they can expect “reasonable substantiation” for sudden changes in demand. They are not told what that means. But food inflation remains.
This ambiguity helps no one. Large suppliers will continue to settle matters privately. Small ones, facing the threat of lost shelf space, may feel forced to absorb losses quietly. As Madsen observes, the Code is unlikely to change much for those it claims to protect.
What it does serve is a narrative. It lets the government appear responsive while avoiding accountability. It shifts attention away from the structural causes of price increases: central bank expansion, regulatory overload, and federal spending. Instead of owning the crisis, the state points to a scapegoat.
This method is not new. The Trudeau government, of which Carney’s is a continuation, has always shown a tendency to favour symbolism over substance. Its approach to identity politics follows the same pattern. Policies are announced with fanfare, dissent is painted as bigotry, and inconvenient facts are set aside.
The Grocery Code fits this model. It is not a policy grounded in need or economic logic. It is a ritual. It gives the illusion of action. It casts grocers as villains. It gives the impression to the uncaring public that the government is “providing solutions,” and that “it has their backs.” It flatters the state.
Madsen’s work cuts through that illusion. It reminds us that grocery margins are modest, inflation was monetary, and the public is being sold a story.
Canadians deserve better than fables, but they keep voting for the same folks. They don’t think to think that they deserve a government that governs within its limits; a government that accept its role in the crises it helped cause, and restores the conditions for genuine economic freedom. The Grocery Code is not a step in that direction. It was always a distraction, wrapped in a moral pose.
And like most moral poses in Ottawa, it leaves the facts behind.
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The Canadian Taxpayers Federation is criticizing Prime Minister Mark Carney for announcing that the government is expanding automatic tax filing within hours of the government’s consultation ending.
“There’s no way government bureaucrats pulled an all-nighter reading through thousands of submissions and survey responses before sending Carney out to make an announcement on automatic tax filing the next morning,” said Franco Terrazzano, CTF Federal Director. “Asking Canadians for their opinion and then ignoring them isn’t a good look for Carney, it makes it look like the government is holding sham consultations.”
The government of Canada announced consultations on automatic tax filing so Canadians could give the government “broad input through an online questionnaire.”
The government’s consultation ended on Thursday, Oct. 9, 2025.
Hours after the consultation ended, Carney today announced the government would expand automatic tax filing.
The CRA is already one of the largest arms of the federal government with 52,499 bureaucrats.
The CRA added 13,015 employees since 2016 – a 33 per cent increase. For comparison, America’s Internal Revenue Service has 90,516 bureaucrats. The CRA has one bureaucrat for every 800 Canadians. The IRS has one bureaucrat for every 3,800 Americans.
“The CRA can barely answer the phone, so Carney shouldn’t be giving those bureaucrats more busy work to do,” Terrazzano said. “The CRA is a bloated mess, and Carney should be cutting the cost of bureaucracy not scheming up ways to give the bureaucracy more power over taxpayers.”
The CRA only answered about 36 per cent of the 53.5 million calls it received between March 2016 and March 2017, according to a 2017 Auditor General report. When Canadians were able to get the CRA on the phone, call centre agents gave inaccurate information about 30 per cent of the time.
“The CRA acting as both tax collector and tax filer is a serious conflict of interest,” Terrazzano said. “Trusting the taxman to do your tax return is like trusting your dog to protect your burger.
“Carney should stop the CRA power grab and instead cut taxes and simplify the tax code.”
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