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If you ask Canadians how they’re reacting to the shock of soaring inflation, they will tell you they’ve cut back: Almost half the respondents to an Angus Reid Institute survey released last week said high prices have led them to spend less overall.

And yet stores are bustling, restaurants overflow with diners and airports are packed with passengers – albeit frustrated ones. This week Statistics Canada reported that retail sales volumes rose 0.9 per cent in April from the month before, a measure that accounts for higher prices. Statscan estimates retail sales climbed an additional 1.6 per cent in May, again outpacing the month-to-month rate of inflation.

There’s no question high prices are hammering lower-income Canadians, with food and gas costs making it difficult to get by. Even so, a combination of low unemployment, pent-up demand and a mountain of savings accumulated during the pandemic has only fuelled consumer demand – certainly longer than many expected.

Canada’s major banks point to a sturdy consumer. Royal Bank of Canada has found that consumer spending on its credit and debit cards is roughly 30 per cent higher than prepandemic levels. After adjusting for inflation, spending by Toronto-Dominion Bank clients using debit and credit cards was up 15 per cent in May from a year earlier. “Consumers are clearly keen to get out and have fun after two years of pandemic restrictions,” TD economists said in a recent report.

But it’s not just pent-up demand being unleashed in formerly ailing service industries. The RBC numbers show people are still buying loads of stuff. It’s a similar story in the United States, where real personal expenditures on goods are still much higher than before the pandemic.

With more options for spending, people are pulling out their plastic more often – and that means credit card balances are rising quickly. The TD report said spending on its credit cards jumped 33 per cent in May from a year earlier. The bank attributed that, in part, to the rebound in travel. About 90 per cent of travel-related transactions are made by credit card.

While Statscan’s retail trade figures show consumers were remarkably resilient in April despite high inflation, real-time anonymized data aggregated by Google from mobile devices suggest Canadians have kept up their spending since then. Visits to retail and recreation places are almost 10 per cent above prepandemic levels.

Real-time data also point to a surge in spending at restaurants. In inflation-adjusted terms, sales at restaurants rebounded above prepandemic levels for the first time in April, while data compiled by booking website OpenTable show the number of seated diners from online, phone and walk-in reservations is more than 20 per cent higher than in the same period in 2019. That doesn’t mean the restaurant industry isn’t suffering, though, with labour shortages, rising wages and skyrocketing costs all combining to hobble many businesses.

Flying may not be fun right now, and the experience is likely to get worse now that both WestJet and Air Canada have announced service reductions, yet the urge to go places is strong. The number of screened passengers at large airports shows levels have surged this summer, according to the Canadian Air Transport Security Authority. While travel isn’t yet back to where it was at this point in 2019, the resurgence comes even though airfares in May were 17 per cent higher than in the same month in 2019, according to Statscan inflation data.

What’s unclear is how long this resilience on the part of shoppers will last. While the Conference Board of Canada’s weekly index of consumer spending climbed 3 per cent in the last week of May from the month before, the organization’s consumer confidence reading for June plunged to its lowest level in 18 months.

With inflation expected to climb further and more rate hikes from the Bank of Canada a near certainty, consumers will face fierce headwinds that could finally spur them to put away their credit cards.

Decoder is a weekly feature that unpacks an important economic chart.

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