OTTAWA: Canada's inflation rate surpassed 5 per cent for the first time since September 1991, rising 5.1 per cent on a year-over-year basis and up from a 4.8 per cent gain in December 2021, Statistics Canada said.
Excluding gasoline, the Consumer Price Index (CPI) rose 4.3 per cent year-over-year in January 2022, the fastest pace since the introduction of the index in 1999, reports Xinhua news agency citing Statistics Canada as saying on Wednesday.
Covid-19 pandemic-related challenges continue to weigh on supply chains, and consumer energy prices remain elevated. Taken together, Canadians continued to feel the impact of rising prices for goods and services, especially for housing, food and gasoline, according to Statistics Canada.
Royal Bank of Canada economist Claire Fan said in a report that gasoline prices were 32 per cent above year-ago levels and were tracking a similar gain in February with pump prices pushed up by higher oil prices.
Against the backdrop, the Bank of Canada is widely expected to begin hiking interest rates in March and "we could see a follow-up hike as soon as April", the economist predicted.
Meanwhile, wage data from the Labour Force Survey found wages rose 2.4 per cent during the same period, meaning that, on average, prices rose faster than wages and Canadians experienced a decline in purchasing power.
Canada's inflation rate grew faster in January