Canadian Personal Finance Blog

Archive for August 20th, 2009

Stats Canada came out with another interesting set of CPI numbers showing (in a way) that our deflationary spiral is accelerating (if you consider a 0.3% drop the previous month and the alleged 0.9% drop in June as a significant acceleration). Soon I’ll be able to buy bread for 2 cents a loaf? No, not at all likely, the reason we have a “drop” in the CPI this month is Energy Products mostly (a 23.4% decline year over year in that sector), and remember those prices moderated late last year, so that drag on the CPI will disappear as a factor in a few months too.

The CPI excluding energy (not seasonally adjusted) is actually up 1.8% (which is still below the Bank of Canada’s goals for inflation), however Food as a component is roaring ahead with a 5.0% (year over year) price increase (wish my investments had that kind of growth).

CPI For Past Little While

Gas prices

This graph shows how gas prices are lower right now, but look at the 2008 graph and how prices started to “moderate” in August and then dropped like a stone for the rest of the year. That damping force will be gone soon from the CPI numbers (so my bet is inflation is going to start moving up the charts again).

Gas Prices Last Year to This

Housing costs have dropped as well with the price of Natural Gas dropping  and the price of houses moderating as well (Shelter portion of the index dropped by 2.0%).

Price of Sin increases

The Sin portion of the Index (OK Alcoholic Beverages and Tobacco Products) is up a healthy 3.1% year over year as well, which means we can’t even drown our sorrows without paying more (for shame!).

The BIG Table

Have a look at the non-adjusted table values, always an interesting read.