What goes up doesn’t necessarily come down.
That’s contrary to the sentiment of a surprisingly large proportion of respondents to the Bank of Canada’s quarterly consumer expectations survey, released last week.
According to the survey, more than a quarter of Canadians believe that current decades-high prices will drop five years from now.
“What goes up must come down,” said one respondent in a post-survey interview.
The sentiment likely raised eyebrows at the central bank
The chance of deflation in five years is “extremely unlikely,” Laval University economics professor Stephen Gordon said.
Though some prices will come down, as has been the case with gasoline prices, Gordon said higher prices for goods feed into each other through the supply chain and become baked into the economy….