Inflation Drops a Little in August
Our amigos over in Stats Canada published the latest CPI numbers yesterday and the rate is slowing a little, but not by much, dropping 0.1% year over year in August.
Instead of it being a tax helping raise the average, this month it seems our old friend Energy took a hand in helping keep the index rising at 1.7% year over year.
Overall, energy prices rose 5.0% between August 2009 and August 2010, following a 7.9% increase during the 12-month period to July. Excluding energy, the Consumer Price Index (CPI) was up 1.4% in August.
Within the energy price index, prices for electricity rose 7.7% in August compared with the same month a year earlier.
Higher consumer prices were also recorded in August for homeowner’s replacement costs (+5.5%), passenger vehicle insurance premiums (+5.1%) and food purchased from restaurants (+2.5%).
More importantly the Bank of Canada’s core index advanced 1.6% in the 12 months to August, matching the rate of growth recorded in July, which might mean the bank will rethink any need for inflation fighting in the near future (we can hope).
The Really Big Table
As a service, here is the really big table from our friends at Stats Canada, as you can see that Energy easily outstrips all other sections of the CPI, but Health continues to rise above inflation as well. That is going to be an interesting part of the index to watch for a good long time.
|Relative importance1||August 2009||July 2010||August 2010||July to August 2010||August 2009 to August 2010|
|Not seasonally adjusted|
|Household operations, furnishings and equipment||11.10||107.0||109.2||109.0||-0.2||1.9|
|Clothing and footwear||5.36||92.1||88.8||90.1||1.5||-2.2|
|Health and personal care||4.73||112.5||115.6||116.4||0.7||3.5|
|Recreation, education and reading||12.20||104.4||105.1||105.0||-0.1||0.6|
|Alcoholic beverages and tobacco products||3.07||131.4||134.5||134.4||-0.1||2.3|
|All-items excluding energy||90.62||113.3||115.0||114.9||-0.1||1.4|
|All-items excluding food and energy||73.57||111.5||113.0||113.0||0.0||1.3|