Ahead of Statistic Canada’s monthly consumer price index report, economists are warning Canadians that things are about to get even more expensive if inflation levels show an anticipated 30-year-high.
“The list of factors driving inflation is so long that it’s easier to name the few things that aren’t escalating. Relative to last year, there aren’t many categories where prices look tame,” CIBC chief economist Avery Shenfeld told the Toronto Star.
Prices are expected to rise anywhere between 5.5% and 6% compared to last year, slightly higher than January’s spike of 5.1%.
Several regions throughout Canada saw fuel at the pumps reach an all-time high as the conflict in Ukraine and sanctions on Russia placed a strain on the industry. In March, gas in Metro Vancouver surpassed $2 per litre, while gas in Toronto reached $1.67 per litre.
Grocery prices have also surged, and industry groups have warned that the high costs of transportation and fertilizer will mean that farmers will have to pass the difference onto consumers.
Trucking and cross-border vaccine mandates are also an issue according to Quinton Woods, Chair of the Trade and Marketing Working Group at the Canadian Horticultural Council (CHC)
“One of the most important challenges—and very timely, based on recent events—is the availability of trucks and truck drivers,” said Woods. ”These shortages were there before the COVID-19 pandemic, but the introduction of the new border measures further reduced the supply of available truck drivers to haul our goods across international borders.”
Additionally, the price of common ingredients used by food companies has spiked by 80% in the last year according to Carla Ventin, Senior Vice-President of Government Relations at Food, Health & Consumer Products of Canada.
“The cost of commonly used ingredients for food companies has increased up to 80% in the past year,” Ventin told the Commons agriculture committee on March 3.
Without gas and food costs, the index is still 3.5% which BMO economist Douglas Porter called the highest Canadians have seen in decades.
“That figure doesn’t sound too high, compared to everything else, but historically speaking 3.5% is still one of the highest growth rates we’ve seen in decades,” said Porter.
