Doubts are mounting in hard-hit Central Canada about the Tories' ability to handle a recession that a majority of voters believe is on the way.
A new poll for The Globe and Mail-CTV News showed the Liberals and Conservatives separated by a scant two percentage points in popular support.
The Strategic Counsel survey also found that Canadians who were convinced the country was on the right track are now less confident about the direction.
"The concerns about the economy are now driving people's political choices," said Peter Donolo, a partner with the firm. "They need a majority and they're heading in the wrong direction."
The survey suggests the Tories would barely hang on to minority status were an election to be held today, with 32 per cent of Canadians surveyed saying they would mark their ballots for the government - down four points from the 2006 election.
The Liberals are holding steady at 30 per cent, the same as in the past election, as are the New Democrats at 18 per cent.
The Greens are at 10 per cent, up five from the vote.
The Tory drop has coincided with a month of negative news, which included the resignation of foreign affairs minister Maxime Bernier, a large spike in gasoline prices, layoffs in Ontario's auto industry and a number of foreign-policy gaffes.
According to the poll, 57 per cent of voters believe Canada is likely to experience a recession over the next six months, up from 45 per cent in April.
Moreover, only a minority of Canadians - 48 per cent - say they believe the country is on the right track, down from 60 per cent in February. Thirty-seven per cent believe the country is on the wrong track, up nine percentage points.
Mr. Donolo said changes in the right-track/wrong-track question can often precede a change in voting intention.
"That's a worrying trend for them," he said, referring to the Conservative government. "Clearly, gas prices feed into that. Hostile relations between levels of government feed into that and scandals in Ottawa feed into that."
On the ability to manage an economic slowdown, 35 per cent of respondents picked the Tories, down three points from February, while the Liberals picked up two points to 27 per cent. The NDP appeared to be the main beneficiary, gaining six points to 11.
But in Central Canada, voters are significantly less sanguine about the Tories' abilities. In Ontario, which has absorbed the brunt of recent layoffs, 32 per cent picked the government as the best stewards of the economy, down six percentage points from February. By contrast, the Liberals were picked by 34 per cent, seven points ahead of where they were.
In Quebec, 29 per cent picked the Tories, down four points, while 24 per cent chose the Liberals, a drop of two points.
Greg Lyle, a pollster with the firm Innovative Research Group, said the Tories may be suffering from Finance Minister Jim Flaherty's attack on the Ontario Liberal government of Dalton McGuinty.
"It was a government strategy to mix it up with the province on the economy and it hasn't worked," he said.
But Mr. Lyle said Canadians still see Conservatives as the best party to handle the economy, and the slowdown could give Mr. Harper an opportunity to show leadership on the issue.
On the race for votes, the Conservatives have dropped most in Quebec, where 16 per cent said they would opt for the Tories, down nine points from the election. The Liberals are up one point to 22 per cent. The Bloc Québécois continues to significantly lead the pack with 46 per cent, up four points.
