TORONTO – CIBC Capital Markets says Canada’s economy is seeing less of a K-shaped pattern in consumer spending compared to the U.S., and while that might appear to be good news, it could actually point to larger issues.
Andrew Grantham, senior economist at CIBC, says the U.S. economy is seeing high-income earners drive most of the growth in consumer spending compared with middle- and lower-income earners, giving way to a K-shaped pattern.
Meanwhile in Canada, he says spending across all income groups have seen similar percentage increases over the past few years, indicating lower-income households could be dipping into savings to support spending.
He says the divergence between the two countries may not be surprising given that Canada’s high-income earners don’t have the same degree of wealth and income compared to their U.S. counterparts.
He also says cautious behaviour among higher-income earners could be cause for concern, as those households may be more sensitive to borrowing costs.
Grantham says the overall trend may be a bad sign, but new data on income and spending, scheduled to be released this week, may change the narrative.
This report by The Canadian Press was first published Jan. 26, 2026.
