Skip to content
Canajun Finances Home » Inflation at 1.1%, That is Low for February

Inflation at 1.1%, That is Low for February

In February 2014 our friends at Stats Canada put out their monthly Consumer Price Index report for February 2014, and year-over-year Inflation was running at a low-ish 1.1%, which is not likely to trigger any kind of reaction from the Bank of Canada (at least it shouldn’t).

This month gasoline helped keep the index down, but how much longer will that work? Gas is back up to $1.30 in Ottawa, and the big “kick in the lower abdomen” will be Enbridge’s 40% Natural Gas jump and Ontario’s Hydro price jumps too.

How much has Gasoline prices jumped around in the past little while, have a look at this graph, and note the index on the left. Those are some wild price swings:

Gas Price Index
Gas Price Index for the Past Little While

The weird part of that graph is the way prices changes are not increasing slowly they slash up and down at an alarming rate.

The scary thing to look at is food prices, to quote our Stats Canada amigos:

Prices for food purchased from stores increased 1.0% on a year-over-year basis, led by higher prices for fresh fruit (+7.5%) and meat (+2.1%). In contrast, prices for dairy products, sugar and confectionery as well as fruit juices declined in February. Prices for food purchased from restaurants increased 1.1%.

Given the problems with the weather in North America, Fresh Fruit prices sky rocketing is to be expected, but it isn’t appreciated.

If we started at 2002 as a start where sits the CPI now, 12 years later? This graph will help you with that:

CPI year over year for past little while
CPI Year over year for the past little while (100 was at 2002)

Not exactly hyper-inflation.

The Big Table

As usual, I include one of the big tables from the report showing the parts of the basket that is the CPI:

Table 1
Consumer Price Index and major components, Canada Not seasonally adjusted

 

Relative importance1

February 2013

January 2014

February 2014

Jan
to Feb 2014

Feb 2013
to Feb 2014

 

%

(2002=100)

% change

All-items Consumer Price Index (CPI)

100.002

122.7

123.1

124.1

0.8

1.1

Food

16.60

132.9

133.0

134.3

1.0

1.1

Shelter

26.26

127.9

130.5

130.7

0.2

2.2

Household operations, furnishings and equipment

12.66

114.3

114.7

115.3

0.5

0.9

Clothing and footwear

5.82

91.4

89.2

91.0

2.0

-0.4

Transportation

19.98

130.3

129.2

130.8

1.2

0.4

Health and personal care

4.93

118.6

118.3

118.4

0.1

-0.2

Recreation, education and reading

10.96

104.7

104.7

106.4

1.6

1.6

Alcoholic beverages and tobacco products

2.79

139.4

140.9

142.9

1.4

2.5

Special aggregates      
Core CPI3

84.91

120.6

121.3

122.1

0.7

1.2

All-items CPI excluding energy

91.44

119.7

120.1

121.0

0.7

1.1

Energy4

8.56

160.1

160.2

162.6

1.5

1.6

Gasoline

4.62

186.1

179.5

183.7

2.3

-1.3

All-items CPI excluding food and energy

74.85

116.9

117.3

118.2

0.8

1.1

Goods

48.18

115.2

114.2

115.6

1.2

0.3

Services

51.82

130.1

131.9

132.5

0.5

1.8

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. For additional information on the core CPI, consult the Bank of Canada website (www.bankofcanada.ca/rates/indicators/key-variables/inflation-control-target/).

4. The special aggregate “Energy” includes: electricity; natural gas; fuel oil and other fuels; gasoline; and fuel, parts and supplies for recreational vehicles.

Inflation in 2014

How did Inflation go in 2014?

Feel Free to Comment

  1. Utilities are a big concern these days with the mess of hydro and the 40% Natural Gas hike coming. All you can counteract them with is to spend less in other areas or increase debt, which I wouldn’t recommend.

  2. Many people suggest raising taxes on fossil fuels to reduce usage and therefore greenhouse gas emissions. I’m not sure that would work much because I don’t see a huge drop in consumption of gasoline even at 1.30+ nor do I see a run on more energy efficient homes despite the nasty winter and consequent increase in Nat Gas pricing. Higher energy costs just seem to result in more budgetary pain not in changed behaviour.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Verified by MonsterInsights