Canadian consumers were already under pressure before energy prices spiked, with trade uncertainty and United States tariffs weighing heavily on much of the country, said Bank of Montreal (BMO).
Indeed, the economy has struggled to churn out anything more than modest growth over the past year, while employment gains have been limited, noted the bank.
In the early stages of the energy shock, consumer insolvencies jumped in March to the highest level since 2009, pointed out BMO.
Admittedly, the seasonally-adjusted figures aren't as dire -- March has regularly seen big increases in recent years -- but the upward trend is "notable," stated the bank.
With gasoline prices rising further and the labor market remaining soft, the rising trend could have room to run, added BMO. Canadians need either a trade deal with the U.S. or a retreat in energy prices to relieve the pressure.
Neither appears poised to come any time soon, according to the bank.