Inflation at the end of 2011 was under control but remained odd in what was up and what was down. Consumer Price Index December 2011.
Year over year, 2012’s Consumer Price Index ended at 2.3%, according to our friends at Stats Canada. The drop from last month’s 2.9% is attributed to moderating gas prices (i.e., not increasing as fast, and in some instances almost dropping a smidge) and car prices dropping a little.
This is not to say gas prices are really dropping, but that the increase compared to this time last year doesn’t seem quite as bad. The year-over-year rise in gas prices was about 7.6%, compared with last month, when the year-over-year rise was effectively 13.5%, so it looks like the gas price increase is declining (but not the price itself).
Other words from Stat Canada:
Consumers paid 4.4% more for food in the 12 months to December, following a 4.8% increase the month before. The year-over-year change for food purchased from stores eased in December to a 5.0% gain from 5.7% in November.
Bouncy, bouncy graph
Even though the CPI is moderating the bad news is that prices are up in every major category on the Index. Everything ends up costing more year over year, is never a good thing to read.
Since 2002, you can see how inflation has chewed away the actual value of a Canadian Dollar, and this period has been low, what happens if inflation suddenly heats up?
Bank of Canada’ Core Index
What the Bank of Canada thinks the inflation rate runs at is even more important, because they are the only one who has a brake for the economy (i.e., money supply rules and Interest Rates), and luckily they think it is actually a little lower than their target, which is around 2.0%, using their index. This means interest rates won’t jump due to inflation for this month.
The Bank of Canada’s core index rose 1.9% in the 12 months to December, after increasing 2.1% in November. Increases were recorded for food purchased from restaurants and passenger vehicle insurance premiums, while prices for the purchase of passenger vehicles declined.
The seasonally adjusted monthly core index posted no change in December.
The BIG Table
Where were the biggest jumps in the CPI? Always check the Stats Canada web pages for more details, but I also love publishing one of their BIG tables.
Table 1 Consumer Price Index and major components, Canada Not seasonally adjusted
| Relative importance ¹ | Dec 2010 | Nov 2011 | Dec 2011 | Nov to Dec 2011 | Dec 2010 to Dec 2011 | |
|---|---|---|---|---|---|---|
| % | (2002=100) | % change | ||||
| All-items Consumer Price Index (CPI) | 100.00 ² | 117.5 | 120.9 | 120.2 | -0.6 | 2.3 |
| Food | 15.99 | 123.9 | 129.2 | 129.3 | 0.1 | 4.4 |
| Shelter | 27.49 | 124.6 | 126.3 | 126.8 | 0.4 | 1.8 |
| Household operations, furnishings and equipment | 11.55 | 109.3 | 112.1 | 111.8 | -0.3 | 2.3 |
| Clothing and footwear | 5.31 | 88.8 | 93.1 | 89.1 | -4.3 | 0.3 |
| Transportation | 20.60 | 121.2 | 127.6 | 125.2 | -1.9 | 3.3 |
| Health and personal care | 4.95 | 115.8 | 117.9 | 118.1 | 0.2 | 2.0 |
| Recreation, education and reading | 11.20 | 103.9 | 104.8 | 104.1 | -0.7 | 0.2 |
| Alcoholic beverages and tobacco products | 2.91 | 134.6 | 135.8 | 135.8 | 0.0 | 0.9 |
| Special aggregates | ||||||
| Core CPI ³ | 82.15 | 116.0 | 118.8 | 118.2 | -0.5 | 1.9 |
| All-items CPI excluding energy | 89.92 | 115.4 | 118.2 | 117.5 | -0.6 | 1.8 |
| Energy4 | 10.08 | 144.0 | 154.1 | 152.7 | -0.9 | 6.0 |
| Gasoline | 5.80 | 158.0 | 175.2 | 170.0 | -3.0 | 7.6 |
| All-items CPI excluding food and energy | 73.93 | 113.5 | 115.7 | 115.0 | -0.6 | 1.3 |
| Goods | 47.80 | 110.0 | 113.8 | 112.6 | -1.1 | 2.4 |
| Services | 52.20 | 124.9 | 127.8 | 127.7 | -0.1 | 2.2 |
Inflation for 2012 Stories
- Inflation Below 1% to end 2012 in Canada. Food prices rose 1.5% year over year in December, after a 1.7% increase in November. Consumers paid 2.2% more for restaurant food and 4.4% more for meat. In contrast, prices declined 5.8% for fresh vegetables.
- CPI Slowing for November 2012 in Canada. Consumer prices rose 0.8% in the 12 months to November, following a 1.2% gain in October. The November increase was the smallest year-over-year gain in the Consumer Price Index (CPI) since October 2009.
- Canada Inflation Steady at 1.2% in October 2012: CPI and Core Index Breakdown . Canada’s inflation stayed steady at 1.2% in October 2012. Moderating energy prices helped ease CPI, while food and shelter costs rose slightly.
- Consumer prices rose 1.2% in the 12 months to September 2012, matching the increase in August 2012. Higher energy prices, particularly for gasoline and electricity, led the advance in the Consumer Price Index (CPI) for September. This was tempered by lower year-over-year price increases for the purchase of passenger vehicles and for food purchased from stores.
- Slowing Inflation some More for August 2012 in Canada. Canada’s inflation slowed to 1.2% in August 2012, with modest price increases for gas, food, and shelter. Core inflation held at 1.6%, offering relief to consumers.
- Inflation Lower in July in Canada 2012 . Canada’s inflation in July 2012 dropped to 1.3%, driven by lower gas and clothing prices, while food costs continued to rise. A look back at what drove CPI shifts.
- CPI Rate Up a Little for June 2012 in Canada. Canada’s CPI rose 1.5% in June 2012, driven by higher vehicle and electricity prices. Core inflation reached 2.0%, nearing the Bank of Canada’s rate-hike threshold.
- CPI Dropped in May 2012, Wow! Yes, for once the prices dropped. Gas prices were the main reason for the drop in price increases. Keep that in mind: prices were still going up, just not that fast.
- April’s CPI Child is Still Inflating (in Canada). Energy prices increased 1.1% in the 12 months to April 2012, following a 5.1% rise in March. The slower increase in April 2012 was largely due to smaller price gains in gasoline and electricity, as well as price declines in natural gas (-13.9%).
- CPI Sneaking Back up for January 2012. Food prices rose 4.2% on a year-over-year basis in January following a 4.4% increase in December. In January, consumers paid 4.9% more for food purchased from stores and 2.8% more for food purchased from restaurants compared with January 2011.
- Inflation Slows a Little to End 2011. Consumers paid 4.4% more for food in the 12 months to December, down from 4.8% the month before. The year-over-year change for food purchased from stores eased in December to a 5.0% gain from 5.7% in November.
Inflation and Consumer Price Index 2011
- Inflation Slows a Little to End 2011. Consumers paid 4.4% more for food in the 12 months to December, down from 4.8% the month before. The year-over-year change for food purchased from stores eased in December to a 5.0% gain from 5.7% in November.
- CPI still Hot for November 2011 in Canada. Consumer prices rose 2.9% in the 12 months to November, matching the October increase. While the 12-month change in gasoline prices continued to ease, year-over-year food prices remained high.
- CPI Slows for October 2011 in Canada. Energy prices rose 11.7% in the 12 months to October, down from a 12.5% gain in September. On a year-over-year basis, gasoline prices rose 18.2%, after advancing 22.7% in September. Prices for fuel oil increased 22.1% in October, following a 27.4% rise the month before. Electricity prices rose, while natural gas prices continued to decline.
- Inflation on the Rise in September in Canada (2011). Energy prices rose 12.5% in the 12 months to September, after a 13.4% increase in August. On a year-over-year basis, gasoline prices rose 22.7%, after gaining 22.8% in August. Fuel oil prices rose 27.4%, while natural gas prices fell 4.7%.
- CPI on the Rebound August 2011 in Canada. The 0.4 percentage point difference between the year-over-year increases posted in August and July mainly resulted from price increases for passenger vehicles, electricity, homeowners’ home and mortgage insurance, telephone services, and jewellery.
- Inflation Slows in July 2011 but Still High(ish). Energy prices rose 12.9% in the 12 months to July, after a 15.7% increase in June. On a year-over-year basis, gasoline prices rose 23.5%, compared with the 28.5% gain in June. In contrast, natural gas prices fell. Food prices rose 4.3% in the 12 months to July, matching June’s increase. Excluding food and energy, the Consumer Price Index (CPI) increased 1.2% in the 12 months to July, after advancing 1.4% in June.
- CPI Slows in Canada (June 2011). Prices for food purchased from stores rose 4.8% in the 12 months to June, up from 4.2% in May. Energy prices rose 15.7% in the 12 months to June, after increasing 16.6% in May. On a year-over-year basis, gasoline prices rose 28.5%, slightly less than the 29.5% gain in May. Fuel oil and electricity prices also rose, while natural gas prices fell 4.6%.
- Yikes: CPI hits 3.7% Gas to Blame for May 2011. Energy prices rose 16.6% in the 12 months to May, after a 17.1% increase in April. Gasoline prices rose 29.5%, the largest increase since September 2005, when prices rose after Hurricane Katrina. The latest year-over-year increase follows a 26.4% gain in April, and leaves the gasoline index just below the peak level reached in July 2008. Fuel oil prices were also higher (+28.2%), and electricity prices rose (+0.9%), while natural gas fell 5.3%.
