The Canadian Federation of Independent Business (CFIB) says its members are hurting from both inflation and rising interest rates. It found that 70 per cent of small business owners expect interest rate hikes to have a negative impact on their operations; 30 per cent say the negative impact will be significant.

The survey was conducted in early August, before the Bank of Canada most recently increased its benchmark interest rate by 75 basis points in an effort to curb inflation. Following five consecutive increases made earlier this year, the policy rate currently sits at 3.25 per cent.

The CFIB says this hurts businesses, with 62 per cent saying they still have $158,000 in pandemic debt remaining, on average.

Consequently, 32 per cent say they plan to raise their prices by six per cent or more in the next 12 months. Nearly 79 per cent further agreed that they’d already raised their prices more than usual in the past year to compensate for rising costs. (The Canadian consumer price index rose to 8.1 per cent in June 2022, the largest yearly change since January 1983. Inflation fell slightly but remained high in July 2022 at 7.6 per cent.)