The annual inflation rate in Alberta was the second highest among provinces in June – trailing only Prince Edward Island.
Statistics Canada reported Friday that consumer price inflation in Alberta rose by 2.8 per cent year over year. P.E.I.’s annual inflation rate was 2.9 per cent.
According to the federal agency’s data, the Consumer Price Index rose by 2.6 per cent on an annual basis in the Calgary census metropolitan area and by 3.1 per cent in the Edmonton census metropolitan area.
StatsCan said the CPI nationally rose by 2.5 per cent on a year-over-year basis in June, following a 2.2 per cent increase in May.
“This is the largest year-over-year increase in the CPI since February 2012,” it said. “This month’s year-over-year CPI increase follows a year of gradual acceleration in consumer price inflation, from a recent low of 1.0 per cent year over year in June 2017.
“This trend reflects increases in prices for gasoline and food purchased from restaurants, as well as offsetting factors such as lower price inflation for electricity and telephone services. These movements coincide with recent improvements in the economy and the labour market, as well as an increase in oil prices.”
StatsCan said seven of eight major components rose year over year with the transportation index (+6.6 per cent) the largest contributor, while the household operations, furnishings and equipment index (-0.1 per cent) was the lone major component to decline.
“Energy costs were 12.4 per cent higher compared with June 2017, after increasing 11.6 per cent year over year in May. Year-over-year gains in prices for gasoline (+24.6 per cent) and fuel oil and other fuels (+25.9 per cent) were larger in June than in May, as sustained increases in crude oil prices and exchange rate pressures continued to impact consumer prices,” added Statistics Canada.
James Marple, senior economist with TD Economics, said price growth nationally is right on target, with evidence of firming in several categories.
“Energy prices will remain volatile, and lower prices for telephone services are still weighing on inflation. Looking through that, inflation is consistent with a healthy economy operating close to full potential,” he said.
“Downside risks to trade remain at the fore, but the economic data are increasingly making the case for further Bank of Canada rate hikes. With a positive retail sales report, and the upside surprise on inflation, the odds of one more hike this year have risen.”
Respected business writer Mario Toneguzzi is a veteran Calgary-based journalist who worked for 35 years for the Calgary Herald in various capacities, including 12 years as a senior business writer.
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