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Summary
- Canada’s Consumer Price Index (CPI) shot up by 2.2 per cent year-over-year (YoY) in March 2021, reported Statistics Canada.
- This was a notable increase from the 1.1 per cent YoY gain in February.
- On a seasonally adjusted monthly basis, March’s was up 0.1 per cent, while its monthly CPI rose by 0.5 per cent.
Canada’s annual inflation rate accelerated last month to cross the two per cent-mark for the first time in over a year.
According to national data agency Statistics Canada, the country’s Consumer Price Index (CPI) shot up by 2.2 per cent year-over-year (YoY) in March 2021. This was a notable increase from the 1.1 per cent YoY gain in February.
On a seasonally adjusted monthly basis, March’s was up 0.1 per cent, while its monthly CPI rose by 0.5 per cent.
©Kalkine Group 2021
What Caused The Inflation Rate To Spike In March?
The increase in Canada’s latest annual inflation rate was significantly impacted by the sharp fall in prices that March 2020 recorded amid the onset of the pandemic.
StatCan explains that as Canada completed a full year of COVID-19, price growth noted in March this year was highlighted by “base-year effects” from a year ago.
As prices nosedived in spring last year, headline CPI growth had decelerated to 0.9 per cent YoY in March 2020. This, in turn, had an upward impact on this year’s consumer inflation.
Price of Energy & Shelter Up In March 2021, Expenditure on Eggs & Dairy Rose
Energy prices shot up in March amid rising oil demand around the world and lower supply.
©Kalkine Group 2021
Gasoline prices saw the highest jump, up by 35.3 per cent YoY, recording the biggest leap in price since March last year.
As costs for construction materials and demand for single-family houses rose hand-in-hand amid a booming real estate market, shelter prices rocketed by 2.4 per cent YoY last month.
The homeowners' replacement cost index, which is related to the prices of new house, jumped by 7.9 per cent YoY in March 2021. Meanwhile, the mortgage interest cost index dwindled by 6.3 per cent YoY.
On a YoY basis, Canadians spent 11.4 per cent more on eggs and 2.4 per cent extra of dairy products in March. The increase, StatCan noted, was primarily due to the items’ lower prices in March last year.
Canada saw the demand for eggs and dairy dwindle during the onset of pandemic last year as lockdown restrictions had left restaurants and other food services closed.
By contrast, increase in supply saw the prices for fresh or frozen beef drop by 2.1 per cent YoY last month.
