![How would you rate current business conditions](https://images.forexlive.com/images/How%20would%20you%20rate%20current%20business%20conditions_id_7156d886-9549-41a0-808e-7e3d0c1ccc27_original.jpg)
- Sentiment fell every month in Q4, from 22% at the start of the quarter to 9% at the end
- 38% of firms expect a recession in the year ahead vs 33% in Q3
- 54% of firms expect inflation to remain above 3% for the next two years vs 53% in Q3
- 75% of firms think wage growth will be back to normal by 2025
- Consumer survey inflation expectations for 5 years to 2.62% from 2.75%
- Future sales 20% vs 14%
- Indicators of future sales vs a year ago -10% vs 0% prior
- Firms see slight improvement in labor availability
![Spike in companies saying that business decreased](https://images.forexlive.com/images/Spike%20in%20companies%20saying%20that%20business%20decreased_id_e6e54915-43aa-4c5c-8e7a-0d7317cfeef4_original.jpg)
Wage growth metrics are improving.
![wage growth](https://images.forexlive.com/images/wage%20growth_id_fe9f1809-89ca-443d-9b4c-84e90a0ebdfa_original.jpg)
Inflation expectations from firms.
![inflation expectations BOC](https://images.forexlive.com/images/inflation%20expectations%20BOC_id_db0569e6-09df-4dc0-bd26-9561cd04b628_original.jpg)
In the consumer survey, note that 5-year inflation expectations are below pre-covid levels.
![Consumer inflation expectations](https://images.forexlive.com/images/Consumer%20inflation%20expectations_id_2d31464d-6b56-40b3-99e1-417a9f751d94_original.jpg)
The survey also showed that consumers are increasingly lowering spending because of inflation and interest rates.
All told, I see plenty of reasons in this survey for the Bank of Canada to cut rates. They meet next week and could very well signal a looming easing cycle. That said, I think they want to snuff out inflation completely rather than get ahead of slowing growth. That will ultimately prove to be a mistake.