Economic storm clouds over the United States are casting an ominous shadow over the border and Canadians are increasingly nervous about the price of gas, food and other goods.
But while caution is the byword, many say they're not ready to lock down their wallets just yet and the still-busy malls and shops suggest the country is weathering the economic inclemency better that its southern neighbour.
"Anywhere you go, it's always crowded," said Amal Matr, out shopping in downtown Toronto with her daughter on Monday.
Although the cost of living is obviously rising, Matr said she doesn't think record fuel prices have so far affected the way people live their lives or how they spend at retailers.
"It's always busy. I don't think it's affecting anybody," said Matr.
"Last weekend we went to Canada's Wonderland (amusement park) and it was full. The parking lot was full. I don't think it's affecting anybody."
On Monday, the Conference Board reported that Canadian consumers' confidence in the economy is falling, hitting its lowest level in seven years in May. The think-tank's confidence index fell seven points in May to 85.8, the lowest level since the survey switched to a monthly reading in December 2001.
When asked if they felt that their family would be better off financially in six months, 26.1 per cent of respondents agreed - 4.4 percentage points lower than in the prior month.
The number of those who felt their families' financial situation would deteriorate over the next six months increased 4.2 percentage points to 17.1 per cent in May.
A rise in gas prices is likely one of the factors behind the dip in confidence, the board noted, although predicted hikes in the prices of other commodities such as food have also caused worry.
The last time consumer confidence fell sharply was in the fall of 2005 after Hurricane Katrina caused a spike in oil.
At Toronto's Eaton Centre on Monday, many shoppers agreed fuel prices were foremost on their minds.
"I think everyone's watching their pennies because of the price of gas and the all the other things that are going up," said shopper Rose Reffell.
"I think all the economies are suffering, so I don't think we're any worse than the States or Great Britain or anywhere else."
University student James Hajdarpasic blamed the bad news filtering north from the U.S., where a credit crisis spawned by the collapse of the subprime mortgage market has left the country teetering on the edge of a recession.o
"I think people are not as confident when they hear the U.S. is facing a huge recession," said Hajdarpasic.
Out shopping with his family, George Galvao said he won't let the price of gas or rising costs affect his life, but he does see it having an impact on others.
"I definitely have not (changed my spending habits). But some people I've seen have been. In the actual manufacturing environment in Ontario there definitely is a slowdown, no doubt about that."
In Vancouver, Edwina James said she has cut back on spending a lot since moving to Vancouver from Sydney a year ago.
She'll opt for public transit over renting a car because of higher gas prices, and has curbed her spending on clothes and dining out.
"I find the taxes here really high," said James on her way to her office in downtown Vancouver on Monday. "Right now I am trying to save more than I ever have in my life".
