OTTAWA Canada's inflation rate reached 5 percent for the first time since September 1991, climbing 5.1 percent year over year from 4.8 percent in December 2021, according to Statistics Canada.
The Consumer Price Index (CPI), excluding fuel, climbed 4.3 percent year over year in January 2022, the quickest rate since the index's inception in 1999, according to Xinhua news agency, citing Statistics Canada. Supply networks are still being weighed down by the Covid-19 epidemic, and consumer energy prices are still high. According to Statistics Canada, rising prices for goods and services continued to have an impact on Canadians, particularly in housing, food, and gasoline.
According to a research by Royal Bank of Canada analyst Claire Fan, gasoline prices were 32% higher than a year ago and were tracking a similar gain in February, with pump prices pushed up by higher oil costs. In light of this, the Bank of Canada is widely expected to begin raising interest rates in March, with "a follow-up boost as soon as April," according to the economist.
Meanwhile, Labour Force Survey found that earnings increased by 2.4 percent during the same period, implying that prices rose faster than incomes on average, reducing Canadians' purchasing power.
More interest rate hikes are likely as inflation in the UK hits a 30-year high.
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