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CPI Jumps to 2.0 in April 2014 in Canada

CPI Takes a Jump in April 2014

Our friends at Stats Canada published on Friday their Consumer Price Index Report for the year ending April 2014, and it seems like our economy is starting to heat up, with inflation running year to year at about 2.0%. Last month year over year we were only at 1.5%, so this could be either a one-month blip or the start of full-blown inflation returning to our happy economic world (haven’t seen much of it in the past ten years or so).

Specifically, they stated:

The Consumer Price Index (CPI) rose 2.0% in the 12 months to April, following a 1.5% increase in March. The rise in April was the largest since April 2012.

The old energy bugaboo has come back to visit, and given the prices of gasoline in Ottawa, I am not surprised. Specifically the terrible triad I am seeing are:

  1. Automobile Gasoline prices keep yo-yo-ing. However, they never quite go down as low as they did previously.
  2. Electrical costs are sky-rocketing (in Ontario, the good)
  3. Natural Gas prices jumped 40% due to it being a cold winter (that is an exact quote from Enbridge).

Without energy being included inflation is running about 1.4%, so you can see the direct impact of this in the CPI, and how these price jumps work in the background of other costs (like shipping costs, and storage costs, etc.,) remains to be seen trickling through the numbers over the next few months.

Figure 1 Year Over Year Inflation with and without Energy Included for Past While

Figure (1) is a nice graph illustrating just how energy prices can skew the data badly for CPI.

Before we jump all over Energy costs as being the sole reason we are paying more, there is another useful graphic to look at here:

Prices by Category
Figure 2 Price Increase in all major components

Figure (2) shows that SIN is becoming more expensive as well (Booze, Tobacco), putting a roof over our heads is costly as well, and driving to work isn’t getting cheaper either. Life is getting more expensive every day.

What Does the Bank of Canada Think?

As we know the Bank of Canada has its own measurement of the CPI and using the Bank of Canada Core Index yardstick prices only rose (year over year) 1.4%, which is just below the economy working OK window that the Bank has published, but will this mean they aren’t thinking about raising interest rates to cool things down? That only time will tell.

The Really Big Table

Figure (2) shows us graphically what is more expensive, but this table shows us the real numbers this is all based on.

Consumer Price Index and major components, Canada Not seasonally adjusted

Relative import1April 2013March 2014April 2014Mar to
Apr 2014
Apr 2013
to Apr 2014
All items Consumer Price Index (CPI)%(2002=100)% change
All-items Consumer Price Index (CPI)100.002122.7124.8125.20.32.0
Household operations, furnishings and equipment12.66114.3115.7115.5-0.21.0
Clothing and footwear5.8294.794.
Health and personal care4.93118.6118.1118.90.70.3
Recreation, education and reading10.96105.2106.5106.2-0.31.0
Alcoholic beverages and tobacco products2.79140.1145.3145.1-0.13.6
Special aggregates      
Core CPI384.91121.0122.5122.70.21.4
All-items CPI excluding energy91.44119.9121.5121.60.11.4
All-items CPI excluding food and energy74.85117.2118.6118.80.21.4

1.2011 CPI basket weights at January 2013 prices, Canada, effective February 2013. Detailed weights are available under the Documentation section of survey 2301 (

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 (

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. >>>given the prices of gasoline in Ottawa

    I just paid $1.36 at the gas station at the corner of Woodroff and Fallowfield. Down the road it was $1.29. Sigh.

    I also bought a candy bar and beef jerky from the same gas station (I just did the Ottawa half marathon, I needed food). I realized the beef jerky was moldy after my first bite so I discarded it and bit into the snickers bar instead – also bad. How long does it take before a snickers bar is inedible? I don’t want to know.

    Ottawa marathon? Outstanding. Gas in Ottawa? Not so much :).

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