The quarterly C-Suite survey was conducted for Report on Business and Business News Network by the Gandalf Group, and sponsored by KPMG. The survey interviewed 151 executives between May 16 and June 12, 2017. Watch for coverage Monday on BNN, and view the full survey online at tgam.ca/csuite.
Nearly three-quarters of Canada's business leaders believe that if the Bank of Canada raised interest rates, it would hurt the economy – while 38 per cent believe such a move would have a detrimental effect on their company directly, according to the latest quarter's C-Suite Survey.
With soaring levels of personal debt and sky-high housing prices in two of the country's biggest cities, "the C-Suite recognizes this country right now cannot afford interest rate rises," says Willy Kruh, KPMG's global chairman of consumer markets.
While executives would welcome improved returns on investments, many are worried about higher rates limiting their ability to borrow, or to repay debts. "If interest rates go up and you have to draw on your debt capacity, it'll have a negative impact on your cash flow," says Tim Granger, chief executive officer of Prairie Provident Resources Inc.
Higher rates could push up the loonie's value, too, making exporting less lucrative. Two-thirds of executives are assuming the Canadian dollar will have a value between 70 cents and 75 cents for the near- and medium-term. Yvon Rousseau, chief financial officer of Uniboard Canada Inc., calls that "the sweet spot" for his business, which sells and purchases wood and wood products in U.S. dollars.