Canada’s inflation rate saw a 7.7% year-over-year increase in May, the largest since January 1983 and up from a 6.8% gain in April. .“Excluding gasoline, the CPI (Consumer Price Index) rose 6.3% year over year in May after a 5.8% increase in April,” said Statistics Canada in a Wednesday report. .“Price pressures continued to be broad-based, pinching the pocketbooks of Canadians and in some cases affecting their ability to meet day-to-day expenses.”.The report said this inflation increase was fuelled by higher gas prices. Higher service prices, such as hotels and restaurants, contributed to the increase. .Food prices and shelters costs stayed high in May despite price growth being unchanged on a year-over-year basis, according to the report. .Wage data from the Labour Force Survey suggested average hourly wages rose 3.9% year over year in May, so prices went up more than salaries in the last year. .The report said energy prices went up by 34.8% on a year-over-year basis in May, driven by the largest one-month price increase since January 2003. It said Canadians paid 48% more for gas in May. .Gas prices increased by 12% in May after a .7% decline in April. This was the largest monthly increase since May 2020, when gas prices began to recover because of serious price drops brought on by the COVID-19 pandemic in March and April 2020. .Year-over-year prices for traveller accommodation were up by 40.2%, most notably in Ontario (56.8%), British Columbia (43.2%) and Nova Scotia (41.8%.) These increases reflected more demand for travel within Canada compared with May 2021. .Higher costs for food from restaurants (6.8%) in May contributed to the uptick in service prices. .The report said grocery prices remained elevated in May, as they rose 9.7%. Edible fats and oils, said the report, recorded their largest increase on record at 30%, which was caused by higher prices for cooking oils. .Fresh vegetable prices increased 10.3% in May. Prices for vegetables such as onions, peppers, and carrots contributed the most to this increase, rising 10.2% on a year-over-year basis..Shelter costs rose 7.4% this past year, said the report. Homeowner replacement costs rose 11.1% year over year in May. .Conservative leadership candidate Pierre Poilievre condemned this inflation increase. .“Stop inflationary deficits,” said Poilievre. .“Bring back common cents.”.Scotiabank economists published a report saying aggressive interest rate increases set by Bank of Canada (BoC) governor Tiff Macklem will punish businesses because of high levels of fiscal stimulus..“The output losses that the BoC must engineer to rein in inflation are falling disproportionately on the private sector,” said Scotiabank’s report. .“In effect, high levels of fiscal spending will necessitate an unnecessarily large crowding-out of private spending.”
Canada’s inflation rate saw a 7.7% year-over-year increase in May, the largest since January 1983 and up from a 6.8% gain in April. .“Excluding gasoline, the CPI (Consumer Price Index) rose 6.3% year over year in May after a 5.8% increase in April,” said Statistics Canada in a Wednesday report. .“Price pressures continued to be broad-based, pinching the pocketbooks of Canadians and in some cases affecting their ability to meet day-to-day expenses.”.The report said this inflation increase was fuelled by higher gas prices. Higher service prices, such as hotels and restaurants, contributed to the increase. .Food prices and shelters costs stayed high in May despite price growth being unchanged on a year-over-year basis, according to the report. .Wage data from the Labour Force Survey suggested average hourly wages rose 3.9% year over year in May, so prices went up more than salaries in the last year. .The report said energy prices went up by 34.8% on a year-over-year basis in May, driven by the largest one-month price increase since January 2003. It said Canadians paid 48% more for gas in May. .Gas prices increased by 12% in May after a .7% decline in April. This was the largest monthly increase since May 2020, when gas prices began to recover because of serious price drops brought on by the COVID-19 pandemic in March and April 2020. .Year-over-year prices for traveller accommodation were up by 40.2%, most notably in Ontario (56.8%), British Columbia (43.2%) and Nova Scotia (41.8%.) These increases reflected more demand for travel within Canada compared with May 2021. .Higher costs for food from restaurants (6.8%) in May contributed to the uptick in service prices. .The report said grocery prices remained elevated in May, as they rose 9.7%. Edible fats and oils, said the report, recorded their largest increase on record at 30%, which was caused by higher prices for cooking oils. .Fresh vegetable prices increased 10.3% in May. Prices for vegetables such as onions, peppers, and carrots contributed the most to this increase, rising 10.2% on a year-over-year basis..Shelter costs rose 7.4% this past year, said the report. Homeowner replacement costs rose 11.1% year over year in May. .Conservative leadership candidate Pierre Poilievre condemned this inflation increase. .“Stop inflationary deficits,” said Poilievre. .“Bring back common cents.”.Scotiabank economists published a report saying aggressive interest rate increases set by Bank of Canada (BoC) governor Tiff Macklem will punish businesses because of high levels of fiscal stimulus..“The output losses that the BoC must engineer to rein in inflation are falling disproportionately on the private sector,” said Scotiabank’s report. .“In effect, high levels of fiscal spending will necessitate an unnecessarily large crowding-out of private spending.”
