Inflation at 0.4 % For April in Canada

Just before the long weekend our friends at Stats Canada published their monthly Consumer Price Index review and they claimed that Inflation for the last 12 months (ending in April) Inflation ran at 0.4%, to which I call, Poppycock! (apologize for the potty mouth).

Gas prices are again the reason that prices are allegedly not going up that fast, however, we have also seen this past weekend, Gas prices jumping 7 cents a litre for no real reason except a need to gouge the hell out of consumers on a long weekend. Oil prices have not moved in the past few months, yet somehow there is a Gas shortage? We are desecrating the environment in Alberta that would make the Leaders of the Industrial Revolution wince, yet gas prices are going up? Wow…

OK, enough of a rant on that, here is a graph to show inflation with and without Gas included, which suggests our reliance on fossil fuels is not dwindling as much as the Granola Crunching Generation would hope:

Consumer Price Index Changes with and without Gasoline

So as we can see Gasoline is still the most important part of the Consumer Price Index. Want to see just how wacky Gasoline prices have been over the past little while?

Up to 25% swings in price changes? Who is Making these Changes? The Market?

Food prices continue to track at about 1.5% year over year price increase, while clothing continues to drop (for all you lovers of clothes produced in 3rd world sweat shops (as opposed to the 20th century where it was North American sweat shops)).

If you look at the seasonally adjust CPI, we in fact had a drop in CPI in April:

CPI Dropped (if you include a Seasonal Adjustment)

Bank of Canada’s core index

As we know the Bank of Canada has their own way of measuring the CPI, but with their “slide rules” they have calculated inflation to be well below their threshold of excitement:


The Bank of Canada’s core index rose 1.1% in the 12 months to April, following a 1.4% increase in March.

On a monthly basis, the seasonally adjusted core index posted no change in April, after rising 0.2% in March.

The Big Table

As usual I include one of the big tables from Stats Canada to help you comprehend where you are spending more:

Consumer Price Index and major components, Canada – Not seasonally adjusted

Relative importance1 April 2012 March 2013 April 2013 March to April 2013 April 2012 to April 2013
% (2002=100) % change
All-items Consumer Price Index (CPI) 100.002 122.2 122.9 122.7 -0.2 0.4
Food 16.60 130.1 132.4 132.1 -0.2 1.5
Shelter 26.26 126.6 128.0 128.2 0.2 1.3
Household operations, furnishings and equipment 12.66 112.6 114.7 114.3 -0.3 1.5
Clothing and footwear 5.82 95.3 95.3 94.7 -0.6 -0.6
Transportation 19.98 131.3 129.5 128.6 -0.7 -2.1
Health and personal care 4.93 118.9 118.3 118.6 0.3 -0.3
Recreation, education and reading 10.96 105.4 105.2 105.2 0.0 -0.2
Alcoholic beverages and tobacco products 2.79 137.7 139.8 140.1 0.2 1.7
Special aggregates
Core CPI3 84.91 119.7 120.9 121.0 0.1 1.1
All-items CPI excluding energy 91.44 119.1 120.0 119.9 -0.1 0.7
Energy4 8.56 161.0 159.9 158.0 -1.2 -1.9
Gasoline 4.62 192.9 186.5 181.3 -2.8 -6.0
All-items CPI excluding food and energy 74.85 116.6 117.2 117.2 0.0 0.5
Goods 48.18 115.3 115.4 114.9 -0.4 -0.3
Services 51.82 129.1 130.3 130.3 0.0 0.9
1.2011 CPI basket weights at January 2013 prices, Canada, effective February 2013. Detailed weights are available under the Documentation section of survey 2301 (www.statcan.gc.ca/imdb-bmdi/2301-eng.htm).
2.Figures may not add up to 100% as a result of rounding.
3.The Bank of Canada’s core index excludes eight of the CPI’s most volatile components (fruit, fruit preparations and nuts; vegetables and vegetable preparations; mortgage interest cost; natural gas; fuel oil and other fuels; gasoline; inter-city transportation; and tobacco products and smokers’ supplies) as well as the effects of changes in indirect taxes on the remaining components.
4.The special aggregate “Energy” includes: electricity; natural gas; fuel oil and other fuels; gasoline; and fuel, parts and supplies for recreational vehicles.

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  • Bet Crooks May 21, 2013, 1:16 PM

    Well I guess if inflation is under 0.5% then I am staying ahead of inflation with my money in the bank at 1.35%…….Why do I not actually believe that?

    When I excluded gas (and clothes/food other variable costs) the real rate of inflation on our 2012 fixed costs (nat gas; electricity; water; property tax; house insurance; car insurance; cable; telephone; internet) was
    1.6%.

    Guess I’d better try to find something better than a bank account.

    Reply

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