To the surprise of absolutely no one in Canada who has walked into a grocery store lately, Stats Canada announced on Friday that the Inflation rate (year over year) for December 2015 (and thus effectively the year 2015) rate of inflation was 1.6%, which seems gosh darn just grand, but as usual, this smelly onion’s aroma is only divulged as you look deeper in the layers of the numbers published.
As we can see from this simple graphic, the numbers are a little cock-eyed if you look a little closer at the details of the report. In the gory details of the report you find a much richer explanation of what is going on in terms of the price of food:
Consumers paid 3.7% more for food in December compared with the same month a year earlier. Prices for food purchased from stores were up 4.1% year over year in December, following a 3.7% increase the previous month. The acceleration was mainly attributable to the fresh vegetables and fresh fruit indexes, which rose more on a year-over-year basis in December than in the previous month. In contrast, the meat index increased less in the 12 months to December (+2.4%) than in November (+3.9%). Prices for food purchased from restaurants rose 2.8% year over year in December, matching the increase in November.
A more detailed part of the report goes into even more interesting details:
Main upward contributors:
- Purchase of passenger vehicles (+3.1%)
- Fresh vegetables (+13.3%)
- Homeownersâ€™ home and mortgage insurance (+8.9%)
- Fresh fruit (+13.2%)
- Electricity (+3.8%)
Main downward contributors:
- Gasoline (-4.8%)
- Natural gas (-12.9%)
- Telephone services (-2.5%)
- Mortgage interest cost (-1.3%)
- Fuel oil (-16.8%)
Hence all of the discussions about the head of Cauliflower costing $8 in some places? The serious part of this is that homeless shelters and similar services are now having problems with their food budgets for the winter. The fact that home and mortgage insurance rates are spiking is another interesting issue that not many folks are talking about?
Bank of Canada’s core index
Remember that the Bank of Canada’s measure of inflation is a bit different, and as they are the ones that might raise interest rates in response to any inflationary spirals, we should check what they think about inflation.
The Bank of Canada’s core index was up 1.9% in the 12 months to December, following a 2.0% rise in November.
Reports from Previous Months in 2015
If you want to have a walk down memory lane about how prices have been going up, here you go.
- 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)
- Gas Dampens CPI for July
- Inflation and Silly Gasoline Tricks Continues in August
- Canadians Paid 3.9% More For Food in September
- Canadians Paid Even More For Food in October (4.1%)
- Food Prices Up 3.4% In November