How do you spell INFLATION?
CPI Going Up
Stats Canada published the November Consumer Price Index numbers yesterday and it is starting to get some momentum in the UP direction, with their index going up by 1.0% (year over year ending in November 2009).
The rise in the all-items Consumer Price Index (CPI) was due primarily to gasoline prices. Prices at the pump are now exerting upward pressure on the CPI after an extended period in which they were the main contributors to year-over-year declines in overall consumer prices.
Interesting that gas prices in December seem to be dropping, so how this changes next month’s CPI remains to be seen.
Bank of Canada’s Core Index
More importantly the Bank of Canada’s Core Index is up 1.5% year over year, which is starting to push inflation into the target zone for the Bank. If this upward pressure continues, this may push the bank to act sooner with an Interest Rate increase to hopefully put the brakes on any Inflationary explosion.
The Big Table
| (2002=100) | |||||
|---|---|---|---|---|---|
| Relative importance2 | November 2008 | November 2009 | October 2008 to October 2009 | November 2008 to November 2009 | |
| Unadjusted | |||||
| % change | |||||
| All-items | 100.003 | 114.1 | 115.2 | 0.1 | 1.0 |
| Food | 17.04 | 119.5 | 121.5 | 2.3 | 1.7 |
| Shelter | 26.62 | 123.4 | 121.3 | -1.6 | -1.7 |
| Household operations, furnishings and equipment | 11.10 | 105.5 | 108.5 | 2.6 | 2.8 |
| Clothing and footwear | 5.36 | 94.1 | 95.1 | 0.6 | 1.1 |
| Transportation | 19.88 | 113.2 | 115.4 | -3.1 | 1.9 |
| Health and personal care | 4.73 | 110.1 | 113.6 | 3.4 | 3.2 |
| Recreation, education and reading | 12.20 | 101.9 | 103.7 | 1.5 | 1.8 |
| Alcoholic beverages and tobacco products | 3.07 | 128.5 | 131.3 | 2.7 | 2.2 |
| All-items (1992=100) | 135.8 | 137.2 | 0.1 | 1.0 | |
| Special aggregates | |||||
| Goods | 48.78 | 108.1 | 108.6 | -1.7 | 0.5 |
| Services | 51.22 | 120.0 | 121.8 | 1.8 | 1.5 |
| All-items excluding food and energy | 73.57 | 111.3 | 112.2 | 1.3 | 0.8 |
| Energy | 9.38 | 130.7 | 132.4 | -12.7 | 1.3 |
| Core CPI4 | 82.71 | 113.0 | 114.7 | 1.8 | 1.5 |
NB: Random Thoughts may be on hiatus for a week or two, given the season coming up, or there might be a special Monday edition, if I feel exceptionally lazy next week.
Christmas Laziness and Cheer
I am planning on doing a Top 10 postings for the Christmas/New Year stretch (given I may or may not be around), so if you have any suggestions for this kind of a list (top 10 for this year), please leave a comment with a title or story you may have particularly liked (written by me, that is).
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December 18th, 2009 at 10:56 AM
If gas really is the driving factor in inflation, I think it has to be overweight in the calculation (perhaps based on 1950s era fuel consumption? Today’s cars are much more efficient). A doubling of gas prices might cost me $30/month…the same in natural gas would be about $35 on average. When there were big swings, I can accept that it may have been pulling things around, but now…gas prices are hovering around where they were this time last year. There effect should be minimal, and we’re now seeing the inflation on all the other items that the energy price bubble burst had been hiding.