The Canadian economy started off the year with a remarkable recovery from the COVID-19 pandemic, but heading in 2023, high interest rates are expected to take a significant toll. “2022 was quite a rollercoaster,” said Randall Bartlett, senior director of Canadian economics at Desjardins.

Since March, the central bank has raised its key interest rate seven consecutive times, bringing it from 0.25 per cent to 4.25 per cent. That’s the highest it’s been since January 2008.

Canadians and businesses facing higher borrowing costs are expected to pull back on spending more noticeably in the new year. Economists expect that process to slow inflation, though how quickly, is unknown.

Click here to learn more.