Economists are warning Canadians that everything is going to get much more expensive if inflation levels hit a 30-year high, as predicted by Statistic Canada’s monthly consumer price index data.
“The list of factors driving inflation is so long that it’s easier to name the few things that aren’t escalating. Relative to last year, there aren’t many categories where prices look tame,” CIBC chief economist Avery Shenfeld told the Toronto Star.
Prices are predicted to grow between 5.5 percent and 6% over last year, slightly higher than the 5.1 percent spike seen in January.
With the help of the conflict in Ukraine and sanctions imposed on Russia, fuel prices in several regions across Canada reached an all-time high. Gas in Metro Vancouver exceeded $2 per litre in March, while gas in Toronto reached $1.67 per litre.
Grocery prices have also continued to rise, and industry groups have warned that high transportation and fertilizer costs will force farmers to pass the cost on to consumers.
According to Quinton Woods, Chair of the Canadian Horticultural Council’s Trade and Marketing Working Group, trucking and cross-border vaccine mandates are also issues (CHC)
“One of the most important challenges—and very timely, based on recent events—is the availability of trucks and truck drivers,” said Woods. ”These shortages were there before the COVID-19 pandemic, but the introduction of the new border measures further reduced the supply of available truck drivers to haul our goods across international borders.”
According to Carla Ventin, Senior Vice-President of Government Relations at Food, Health & Consumer Products of Canada, the price of common components used by food firms has increased by 80% in the last year.
“The cost of commonly used ingredients for food companies has increased up to 80% in the past year,” Ventin told the Commons agriculture committee on March 3.
The index is still 3.5 percent excluding gas and food costs, which BMO analyst Douglas Porter described as the highest in decades for Canadians.
“That figure doesn’t sound too high, compared to everything else, but historically speaking 3.5% is still one of the highest growth rates we’ve seen in decades,” said Porter.