Inflation on the rise
Posted Feb 18, 2010 7:15 am.
This article is more than 5 years old.
Higher inflation helped usher in the new year.
Statistics Canada is reporting the annual rate of inflation rose to 1.9 per cent last month, up from 1.3 per cent in December.
Higher gasoline prices are getting most of the blame, with the cost of fuel up almost 24 per cent from the same period a year ago.
TD Securities Chief Economist and Rate Strategist Eric Lascelles tells
660News the increase could make the Bank of Canada re-think when to boost it’s key lending rate.
At the moment the central bank has no plans to boost rates until the summer.
Lascelles says before anybody gets excited about the economy overheating he says we need to see what happens over the next couple of months.
He says with unemployment still high and factories across the country empty, economic activity is less than stellar and that could help cool inflation.
Scotia Capital Economics Vice-President Derek Holt says the numbers are not so much about what’s happening right now but what happened during the recession.
Holt says the figures show during the economic downturn inflation didn’t cool as much as expected.
The cost of six of the eight major components that Statistics Canada tracks were up.
Alberta’s rate more than doubled to 1.7 per cent. Calgary’s rate now sits at 1.4 per cent, up from 0.2 per cent last month.
