Inflation: Biggest annual increase since 1983

Consumer prices continued to rise in Canada in May 2022, where year-on-year inflation reached 7.7%. That’s the biggest annual increase since January 1983, according to the latest Statistics Canada data released on Wednesday.

Excluding gasoline, the consumer price index (CPI) rose by 6.3% year-on-year in May, exceeding the 5.8% increase recorded in April 2022 (+4.7%).

According to Statistics Canada, price hikes remain widespread, putting pressure on Canadians’ wallets and “in some cases affecting their ability to afford day-to-day expenses.”

The acceleration of growth in May is mainly due to the increase in gasoline prices, which increased by 12% compared to April 2022, as well as the increase in prices for services such as hotels and restaurants.

“According to Labor Force Survey wages data, average hourly wages rose 3.9% in May from a year earlier, meaning that the price increase exceeded wages on average over the previous 12 months,” the federal agency also noted.

Between April and May, CPI rose 1.4% in May after rising 0.6% in April.

The increasingly expensive shopping basket and petrol

Year on year, Canadians paid 9.7% more for groceries bought in stores in May.

“Disruptions in the supply chain and rising transportation and input prices continued to put upward pressure on prices,” Statistics Canada said.

In particular, edible fats and oils (+30%) saw a record increase, mainly due to higher edible oil prices.

Gasoline prices rose 12% in May after falling 0.7% in April. This is the largest monthly increase since May 2020, according to Statistics Canada.

Year on year consumers had to pay 48% more to fill up with petrol in May.

In Quebec, the CPI rose 7.5% year-on-year. On a monthly basis, it rose by 1.4% between April and May.

Residents of Prince Edward Island are grappling with the country’s worst inflation rate, which hit 11.1% year-on-year, followed by Nova Scotia and New Brunswick (8.8%) and Manitoba (8.7%).

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