The cost of living was way higher in March than February. Statistics Canada says the cost of living raised almost two per cent. Cheaper gas prices over 12 months keep on raising food, rent and mortgages costs in check. Thus Canada inflation rate rose from 1.5% in February to 1.9% in March.
The inflation was in the exact figure as expected by economists.
Even if the gas would not be cheap still the inflation rate would be higher due to the high eight major components.
In March, gas prices were 4.4% cheaper than a year ago.
Statistics Canada said if energy prices are stripped out, the overall inflation rate would have been as high as 2.2 per cent.
Canada Inflation Rate Uplift Reason:
There are various factors which helped in the increase in the inflation rate. These reasons comprise of higher food costs, rents, car insurance premium, and mortgages.
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Food:
Food was the foremost reason for inflation jump. Fresh vegetable price rose up by 15.7% in last year. While fresh fruits prices are risen up by 8.6%.
Soaring price percentage of different fruits and vegetable are as following:
- Oranges 8.57%
- Apples 13.92%
- Potatoes 13.92%
- Tomatoes 15.98%
- Lettuce 19.25%
Salmonella outbreak caused drastically cut the supply of Romaine lettuce.
In Addition, meat prices have risen by 1.85 per cent in the past year. Also, the prices of dairy products and eggs have gone up by 2.46%. Whereas baked goods prices remain under 2%.
Collectively, food price inflation escalated to 3.6% in March than as compared to 3.2% of the previous month.
Other Factors:
Apart from food, many other things raised the living cost such as mortgage costs and rents. Mortgage costs and rents have increased by 8.1% and 2.7% respectively.
Not just that, car insurance premiums have also contributed to accelerated inflation by 5.6% rise.
Talking about regional inflation, British Columbia has a high percentage of 2 while Prince Edward Island has lower than 1%.
Toronto-Dominion Bank economist James Marple said, “Inflation made a bit of a comeback in March, but mostly as past declines in prices dropped out of the year-on-year calculation.”
