Inflation rate stays tame
OTTAWA—Canada’s inflation remained barely visible for the second-consecutive month in December as consumers enjoyed one of the best years in terms of purchasing power since the recession, Statistics Canada said today.
The annual inflation rate remained at 0.8 percent in December, capping off a year in which price increases largely have been constrained by a weakened global economy.
“Today’s inflation numbers were well-below what markets and the Bank of Canada were expecting—in short, inflation simply is not an issue in Canada, at least not at the moment,” TD economist Francis Fong wrote in a research note.
“That being said, the end of 2012 was certainly a cyclical low with regards to economic growth and things are expected to heat up from here,” he added.
November and December saw lower prices on a wide range of goods and services, helping bring the annual inflation rate in Canada to an average of 1.5 percent, about half the rate of the previous year and the lowest level since 2009, when the economy still was hobbled by recession.
“The slower increase in the CPI [consumer price index] in 2012 compared to 2011 was largely attributable to smaller price increases in gasoline and food,” StatsCan said.