CPI Sneaking Back up for January

in Bank of Canada, Inflation, Stats Canada

So the news continues to be neither good nor bad (ni bon ni mal?), as Inflation continues to chug along at 2.5% for the year ending in January 2012, whereas last month it was at 2.3%, so it is going back up. Stats Canada’s report shows a few nasty things to note:

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.

The cost of energy advanced 6.5% in the 12 months to January, after rising 6.0% in December. Gasoline prices increased 6.8% in January. The electricity index rose 7.3%, with notable increases recorded in Alberta and Nova Scotia. Prices for fuel oil went up 17.1% while natural gas prices fell 0.7%.

OK, so that one really does worry me. All energy is going up in price and so is food, and frankly the rest of the index means little or nothing to me, so what I am reading is that the Real BCM Index is actually at 5.35%? This makes me (BCM) very unhappy. Living expenses should be part of the BCM index, but for now, it’s not that big a jump, but I am astounded that the media does not make more of a stink about the energy and food portion of things?

CPI for the past little while, with and without Food & Energy

The problem with this graphic is that it should include a Food and Energy ALONE line as well. If anyone from Stats Canada is reading, please add THAT line to get across the point that Food and Energy are spiraling up in a very nasty way.

Bank of Canada’s core index

The folks at the Bank of Canada have their own way of looking at the index, so here is their view on things:

The Bank of Canada’s core index rose 2.1% in the 12 months to January, after increasing 1.9% in December. Notable increases were recorded for electricity, food purchased from restaurants and homeowners’ replacement costs.

The seasonally adjusted monthly core index rose 0.3% in January after falling 0.1% in December.

The good news is this is within their “I don’t like it, but we won’t do anything” range, but it is starting to get into the “we are annoyed and will do something” range too.

The Big Table

My favorite parts of these posts are the HUGE Table that Stats Canada includes with the monthly post.

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

Relative import¹ January 2011 Dec 2011 Jan 2012 Dec 2011 to Jan 2012 Jan 2011 to Jan 2012
% (2002=100) % change
All-items Consumer Price Index (CPI) 100.00² 117.8 120.2 120.7 0.4 2.5
Food 15.99 124.9 129.3 130.2 0.7 4.2
Shelter 27.49 124.5 126.8 127.1 0.2 2.1
Household operations, furnishings and equipment 11.55 109.6 111.8 112.2 0.4 2.4
Clothing and footwear 5.31 87.9 89.1 89.3 0.2 1.6
Transportation 20.60 122.8 125.2 127.4 1.8 3.7
Health and personal care 4.95 115.8 118.1 118.1 0.0 2.0
Recreation, education and reading 11.20 102.7 104.1 102.6 -1.4 -0.1
Alcoholic beverages and tobacco products 2.91 135.2 135.8 136.3 0.4 0.8
Special aggregates
Core CPI³ 82.15 116.0 118.2 118.4 0.2 2.1
All-items CPI excluding energy 89.92 115.5 117.5 117.9 0.3 2.1
Energy4 10.08 146.0 152.7 155.5 1.8 6.5
Gasoline 5.80 163.6 170.0 174.7 2.8 6.8
All-items CPI excluding food and energy 73.93 113.4 115.0 115.2 0.2 1.6
Goods 47.80 110.5 112.6 113.6 0.9 2.8
Services 52.20 125.0 127.7 127.8 0.1 2.2
1. 2009 CPI basket weights at April 2011 prices, Canada, effective May 2011. Detailed weights are available under the Documentation section of survey 2301 (www.statcan.gc.ca/imdb-bmdi/index-eng.htm).
2.Figures may not add to 100% as a result of rounding.
3.The Bank of Canada’s core index excludes eight of the Consumer Price Index‘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, please consult the Bank of Canada website (www.bankofcanada.ca/rates/price-indexes/cpi).
4.The special aggregate “Energy” includes electricity; natural gas; fuel oil and other fuels; gasoline; and fuel, parts and supplies for recreational vehicles.


  • Joe February 20, 2012, 12:54 PM

    Really? You believe StatsCan #s? Inflation has been at under 3% for years, meanwhile the housing market has skyrocketed at 10%+ for the last decade?Unemployment doesn’t track the massive shifts from full to part time work, $50/hr auto manufacturing jobs to $10/hr call center jobs, permanent work to contract/self-employment, employment in one’s field of training to unrelated survival employment. StatsCan COULD track these numbers, but they don’t. Instead they put out absolute garbage.

    The truth about CPI, Unemployment stats, etc. is that if StatsCan published the real numbers it’d reveal the truth – that Canada is, at best, experiencing stagflation (those secret Cdn bank bailouts by CMHC and the feds required us to print a lot of money!) and, at worst, a depression. When was the last time that we had a protracted, five year “recession” predicated on an asset bubble (rather than the mere ebb and flow of inventories and inflation) wherein growth occured before turning to contraction in constant fits and starts? The answer is the great depression. Interestingly, depressions used to happen every 50 or so years, until the Great Depression. If this isn’t a depression, I don’t want to see one…


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