Canadians paid more for most goods and services in March than they did a year ago, but the overall Consumer Price Index (CPI) continued to be held back by low gas prices, according to Statistics Canada data released April 22.
The CPI grew 1.3% year-over-year in March, beating analysts’ expectations, after rising 1.4% in February. Core inflation, which excludes the eight most volatile components of the index, increased 2.1% over the year.
While gas prices actually increased 5.7% in March, marking the first monthly increase in this area in seven months, they still remain down 13.6% from a year ago. Excluding gas prices, inflation was up 1.9%.
“Energy prices remain in negative territory on a year-on-year basis, keeping headline inflation in Canada benign,” TD Economics’ Leslie Preston said in a note to investors. “That said, core inflation is proving resilient, with slightly stronger price pressures in a variety of categories in March.
“Time will tell whether this is a one-month blip or the start of a trend, but in our view, it is too early to get worried about the slight uptick in core inflation.”
Some of the biggest price increases in the 12 months to March were in food (up 3.6%), shelter (up 1.1%) and household operations (up 1.7%).
The only non-energy-related category that saw a decrease was clothing and footwear (down 0.4%).
British Columbia had the country’s biggest year-over-year increase, at 1.7%, followed by Alberta and Ontario (both 1.5%).
StatsCan also released retail data for February on the same day. These figures showed sales increased 0.4%, bringing the total to an all-time high of $44.2 billion. As in the case of the CPI, gas prices held this indicator back. Excluding gas, sales increased 1%.
The Canadian dollar reacted positively to Statistics Canada’s reports; as of press time the loonie was trading at 78.9 cents U.S., up half a cent.
@EmmaHampelBIV
Check out BIV’s podcast for the week of April 18, 2016:
