No one likes having to shell out more for their purchases. Shoppers in Alberta may have noticed some better deals in July—but barely.
Prices for household goods and services in our province, as measured by the Consumer Price Index, rose 2.2 per cent in July over a year ago. That is down slightly from the 2.3 per cent increase posted in June, but still well above both the Canadian average and the target of the Bank of Canada.
Price increases for household natural gas (+17.9 per cent) and electricity (+8.9 per cent) contributed to Alberta’s overall inflation. Other price increases in July included homeowners' home and mortgage insurance (+7.9 per cent), public transportation (+6.6 per cent) and gasoline (+5.3 per cent).
No items in the basket of consumer goods showed appreciable price decreases in July.
The Bank of Canada’s “core” index—which strips out eight of the most volatile components of the CPI—increased by 1.4 per cent nationally, a small increase over June’s reading.
The slight uptick in Canada’s inflation last month will do little to worry the Bank of Canada about overall price pressures. Inflation is still near the lower end of the 1-3 per cent band that the Bank uses as a preferred range. With the Bank expecting economic growth expected to be “choppy” this year—and with plenty of slack in the economy remaining—reductions in monetary stimulus (i.e., increases in interest rates) are still likely more than a year away.*
*Courtesy of Todd Hirsch, Chief Economist