Statistics Canada reported last Friday that Greater Calgary and Alberta in general were experiencing the lowest inflation rates in the country. Consumer prices went up by just 0.8 percent within the last 12 months. Compare that to the average two percent hike seen nationally. In the Calgary metro area the prices went up 0.9 percent.
In April the inflation rate for Calgary and Alberta were 0.3 percent on a monthly basis and 0.4 percent for the rest of Canada. ATB Financial’s senior economist Todd Hirsh noted that Alberta residents are taking notice, particularly when it comes to their energy costs. This is the lowest inflation rate seen by consumers since the low point in the 2010 recession.
Hirsh noted that the inflation rate does not indicate a slow down in the economy or a lack of consumer demand. It was created by a 27.7 percent decrease in the price of natural gas, and a 19.4 percent drop in electricity prices. Some individual areas did see increases. Personal care products were up 5.1 percent, insurance costs up 6.4 percent and fresh produce, particularly fruit, saw a 9.6 percent increase.
Nationwide, Statistics Canada noted a 1.1 percent increase in energy costs during the last 12 months. This was due to lower price gains for electricity and gasoline, with natural gas prices going down 13.9 percent. Excluding energy, the Consumer Price Index went up 2.1 percent during the same time period. March saw a 1.6 percent increase.
Transportation costs in Canada went up 3.2 percent comparing April of 2012 with the same month in 2011. New passenger vehicle prices increased 3.4 percent and gas prices went up 3.3 percent. Food prices for April were up 2.5 percent. The core index for the Bank of Canada was up 2.1 percent. Between April and March of this year, the core index went up 0.4 percent, after a 0.1 percent increase between March and February.
Rumors are afloat that this may result in interest rate hikes, but the economic instability in Europe may counteract the effect. Canada, unlike most of the world, is continuing to have economic reports that are in positive territory.