The game of numbers, known as the Consumer Price Index from Stats Canada (for August), continue to show an optimistic story on the surface, and a more interesting one underneath the sheets. (Remember: Lies, Damn Lies and Arithmetic)
The following two lines from the report outline things nicely:
The Consumer Price Index (CPI) rose 1.1% on a year-over-year basis in August, following a 1.3% gain in July.
Excluding gasoline, the CPI was up 1.7% year over year in August, after posting a 1.9% increase in July.
Without gasoline, numbers are still not bad, but then have a look at the data in detail, where you find out that year over year, Electricity rates are up 5.2% (across Canada). In Ontario, I am sure it is even bloody higher!
Main contributors to the 12-month change in the CPI:
Main upward contributors:
- Purchase of passenger vehicles (+5.2%)
- Homeowners’ replacement cost (+4.0%)
- Electricity (+5.6%)
- Food purchased from restaurants (+2.5%)
- Air transportation (+5.7%)
Main downward contributors:
- Gasoline (-11.5%)
- Natural gas (-9.9%)
- Travel tours (-5.6%)
- Telephone services (-1.2%)
- Fuel oil (-11.8%)
See, if you look at the numbers close enough, you can really depress the hell out of yourself.
Bank of Canada’s core index
The Bank of Canada’s core index increased 1.8% year over year in August, following a 2.1% gain in July.
The importance of this, is that while this is still within the Bank of Canada’s “comfort zone” for inflation, interest rate increases may still happen (you just can’t blame it on Inflation (directly)). Also remember, the Governor of the Bank stated, Lower-for-longer interest rates require adjustments, better read what needs to happen to keep rates low (your sphincter might tighten a little).
Reports from the Past While.
If you want to have a walk down memory lane about how prices have gone up, here you go.
- Electricity Prices Continue to Sizzle in July
- Zap! Electricity Prices Pushes Inflation in June
- Expensive Food and Shelter in April in Canada
- Good Food Still Is Not Cheap in Canada (Inflation for March)
- Food Prices Continue to Rise for February
- Veggies up 18.2 pct in Canada
- Food Prices up 4.1% For 2015 in Canada
- Gas Prices Drive Down Inflation in December to 1.5%
- Lower Prices in January in Canada, Pull the Other Leg
- Expensive Food in Canada in March
- Prices up 0.8% in April or More Fun with Numbers
- Inflation at 0.9% for May (maybe)