It was a good news/bad news story on March inflation numbers, depending on what part of the country one happens to be in and what’s in the shopping cart — or more accurately, the gas tank.According to Statistics Canada, 4.5% higher gasoline prices pushed the consumer price index (CPI) up to 2.9% from 2.8% in February which is still within the Bank of Canada’s target range of 2% to 3% but headed in the wrong direction for economists waiting for interest rate cuts.And in terms of housing — which is sure to be a major focus of Tuesday’s federal budget — the numbers were equally dim. Shelter prices continued to account for a disproportionate share of overall price growth, especially rents that rose 8.3% in March, the highest since 1983.Mortgage interest costs, which lag earlier interest rate increases, continued to moderate but were still 25.4% higher year-over-year and pushed overall home ownership related expenses at 6.8%..The March numbers don’t include a 24% increase in the carbon tax that took effect on April 1, or the reinstatement of Alberta’s gasoline tax that took effect the same day. In less that a week, the retail gas price in Alberta jumped more than 25 cents a litre.Food inflation was a bright spot. Grocery costs dropped to 1.9% year-over-year even though the cost of dining out rose 5%.Excluding energy and shelter related components the central bank’s so-called ‘supercore’ number dropped to 2.8% in March on a three-month annualized basis from 3.4% in February. That helped convince economists that “broad based easing in price pressures in Canada are indeed underway,” according to RBC Financial Group..“We continue to look for slowing inflation that will allow for a first rate cut from the BoC in June,” it said.Manitoba continued to have the lowest inflation in Canada at just 0.8%, followed by Saskatchewan at 1.5%.Alberta’s was the second-highest in the country, at 3.5% although it was down from 4.2% at this time last year. Quebec’s was highest at 3.6%, which was up from 3.3%.
