REVEALED: Canadians losing significant purchasing power

Canadians have lost significant purchasing power over the last 25 years, according to the Bank of Canada Inflation Calculator.

“Are you noticing your dollar doesn’t go as far? Since 2000, the Canadian dollar has lost 41% of its purchasing power — $100 then buys just $59 worth today, the hidden tax of inflation,” said Analyst Ryan Williams.

Canada’s cost of living crisis continues to challenge households, even as inflation shows signs of easing. The annual inflation rate dropped to 1.7% in July from 1.9% in June, according to Statistics Canada. However, rising costs for essentials like food, shelter, and rent remain a burden.

Food prices surged 3.4% year-over-year in July, while shelter costs rose 3.0%, with rent increasing by 5.1%, per recent data.

Lorrie Goldstein of the Toronto Sun highlighted the ongoing struggle, saying, “Our cost of living is still in crisis. Groceries cost 27.1% more compared to July 2020.”

This sentiment echoes a TD Bank Group survey from January 2025, where 49% of Canadians cited inflation and living costs as their top financial concern, down 9% from the previous year.

Emily Ross, VP at TD, noted, “Although the cost of living is still clearly a concern… the survey results indicate that things are moving in the right direction.”

Economists remain cautious. Douglas Porter of BMO Capital Markets said in 2024, “We’ve just had one of the biggest declines in inflation that we’ve ever seen without a full-on recession. That’s great news,” yet warned, “Can we get the rest of the way down to two percent? Without much pain? That’s still the big question.”

With wages growing only 8% since 2021 against a 25% rise in household costs, as noted by @DeltaHarbour on X, many Canadians feel the pinch, fuelling calls for policy action amid economic uncertainty.