Inflation stabilizing, business confidence rising

The report also showed signs of economic stability, with inflation expected to align with the Bank of Canada’s target of 2% year-over-year in the first quarter of 2025. This is a slight drop from 2.1% in the final quarter of 2024.

Private investment is also rebounding, supported by an increase in long-term business confidence. This marks a turnaround after weaker performance earlier in 2024. Job vacancies in the private sector remained steady, with 378,300 unfilled positions in the fourth quarter of 2024, representing a job vacancy rate of 2.7%.

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Canadian businesses face tariff concerns

The looming US tariff threat has cast uncertainty over Canada’s economic outlook. Gaudreault noted that given the strong trade ties between Canada and the US, new tariffs could lead to rising inflation and additional struggles for small- and medium-sized businesses already grappling with weak demand.

“It’s critical to create conditions where small businesses can thrive as we navigate these challenges,” he said.

Optimism varies across sectors

The report revealed that while professional, business, and financial services sectors remain above the all-industry optimism average, they have become less optimistic in the past two years.

CFIB, which represents 100,000 small and medium-sized businesses across Canada, continues to advocate for policies that encourage economic growth and support small business success.

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Romana King Senior Editor, Money.ca

Romana King is the Senior Editor at Money.ca. She writes for various publications, and her book -- House Poor No More: 9 Steps That Grow the Value of Your Home and Net Worth -- continues to be an Amazon bestseller. Since its publication in November 2021, this book has won five awards, including the New York CPA Society's Excellence in Financial Journalism (EFJ) Book Award in 2022.

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