Statistics Canada reported Wednesday annual inflation was 5.7% for February..Annual inflation was up from 5.1% in January and is the highest since August 1991 and outstrips the median estimate of 5.5%, reported a Bloomberg survey of economists. .Canada’s consumer inflation rate was already increasing at an unacceptable rate and now adds pressure on Bank of Canada governor Tiff Macklem to make a move on central bank interest rates again, sooner rather than later..The central bank predicted in January that the consumer price index would average year-on-year upticks of 5.1% for each first quarter. The average over the first two months is 5.4% — a concerning statistic for a nation that had become accustomed to its inflation rates being a non-event..Inflationary increases showed up in the usual places; gasoline, groceries, and housing costs continued to trend higher, increasing at the fastest year-on-year rate since August 1983..Statistics Canada included in its Consumer Price Index announcement a statement some might see as a rationale for increasing inflation at higher-than-expected rates, however, many would argue inflation was already increasing exponentially before the onset of the Russia-Ukraine conflict.. Inflation-FebStatistics Canada, Feb 2022 .“Monthly gasoline prices increased 6.9% amid geopolitical conflict in Eastern Europe and the Middle East, as uncertainty surrounding global oil supply put upward pressure on prices. Similarly, prices for fuel oil and other fuels increased 8.5% month-over-month following higher international energy prices,” Statistics Canada said..Inflation is expected to rise after Russia’s invasion of Ukraine sent the commodity market into near-crisis with a leap in prices. It brings up questions about whether Canada’s central bank policy has been adequate in its response to mitigate risks and correct its direction..Statistics Canada included in its report some details on typical household purchases..“Price growth for meat (+11.7%), including fresh or frozen beef (+16.8%) and chicken (+10.4%), was higher year-over-year in February than in January (+10.1%). On a year-over-year basis, prices for dairy products and eggs were up 6.9%, following a 4.5% gain in January, as the farm gate milk prices producers receive increased on February 1, 2022 to partially offset higher production costs. In contrast, price growth for bread, rolls, and buns (+3.7%) slowed year over year in February compared with January (+7.5%),” the agency said..“Consumers paid higher prices for household appliances (+7.8%), including cooking appliances (+9.4%), refrigerators and freezers (+15.6%) and laundry and dish-washing appliances (+9.1%), compared with February 2021. In addition, prices for non-electric kitchen utensils, tableware and cookware increased 10.4% on a year-over-year basis in February, following a gain of 7.5% in January,” it said..Conservative leadership candidate Pierre Poilievre responded Wednesday to the new Consumer Price Index numbers from Statistics Canada..“Predictably, Justinflation has hit an all-time high,” said Poilievre. “Justin Trudeau’s money-printing is making life more expensive. It means 35-year-olds are living in their parents’ basements and moms are having to cut back on groceries for their kids. People can’t even afford to fill up their cars with gas,” he said..“The only people who didn’t predict this are the gatekeepers who don’t feel the pain of inflation — the media, and the Liberals,” said Poilievre. “These same people deny that the Trudeau-Brown carbon tax is adding fuel to the fire. It’s time to get serious about inflation and give Canadians back control of their own future,” he said..Increased central bank interest rates are expected to tamp demand for consumer goods, but won’t affect geopolitical factors contributing to the increasing global commodity pricing and market forces..Canada’s unemployment rate fell to 5.5.% in February indicating economic recovery following the end of the pandemic. Canada’s GDP has been restored to a level such that the Bank of Canada says it believes stimulus is no longer required..Inflation has now exceeded the Bank of Canada’s 1% to 3% control range for 11 months. The inflation rate averaged approximately 1.8% since Canada introduced inflation targeting in the early ’90s..Amanda Brown is a reporter with the Western Standard.,.abrown@westernstandardonline.com
