ottawainflation expectations in canada gradually declined in the second quarter but remain elevated with a growing segment of businesses believing it will take five years or more for inflation to slow to 2 according to the bank of canadas latest quarterly businessoutlook survey the survey indicated that several firms plan over the coming 12 months to make bigger and more frequent price increases than they usually would while executives report that labormarket pressures have eased average wage increases of about 45 over the next year will still be larger than normal the survey said although price growth is easing businesses have not yet returned to their prepandemic pricesetting behavior said the bank of canadas quarterly businessoutlook survey the central bank  which surprised markets earlier this month by lifting its benchmark interest rate by a quarterpercentage point to 475 or a 22year high  has cited corporatepricing behavior as a dynamic it would closely follow to determine whether policy is on the right path toward hitting its 2 inflation target other factors include inflation expectations and wage growth the business survey along with another measuring consumer expectations provide senior bank of canada officials with data it reviews before issuing its next interestrate decision which is scheduled for july 12 recent data indicate some weaknening of the labor market and a sharp cooldown in headline inflation however economists are leaning toward another rate increase next month as shortterm measures of underlying or core inflation remain elevated the central bank said the survey was conducted between may 8 to 25 or prior to the central banks june 7 rate increase the bank of canadas mandate is to set rate policy to achieve 2 inflation or the midpoint of a 1 to 3 range firms expectations for inflation for the short term have edged down but continue to be elevated the survey said the survey indicated that 30 of respondents believe inflation will be in the 2 to 3 range over the next two years versus 17 in the previous quarterly survey meanwhile 64 of respondents suggested inflation would remain above 3 over the next two years which is down from nearly 80 in the first quarter the central bank also said 16 of firms surveyed think it will take five years or more for inflation to return to 2 inflation compared with 7 in the previous quarter half of respondents added it would two to four years to hit 2 inflation down slightly from the first quarter in its statement explaining the decision to raise rates this month the bank of canada said concerns had increased that inflation could get stuck materially above the 2 target given unexpectedly strong economic growth in the first quarter of 31 at annual rate the central bank said monetary policy wasnt sufficiently restrictive to bring supply and demand back into balance and return inflation sustainably to the 2 target earlier friday statistics canada said the countrys gross domestic product was largely unchanged in april from the previous month weighed down in part by a prolonged strike by publicsector workers the datagathering agency however said early indicators suggest gdp rebounded in may up 04