Food prices to rise due to weak Canadian dollar: expert

Trips to the grocery store have already become more expensive, but a low Canadian dollar could make that pain even worse.

Food economist with the University of Guelph, Mike von Massow, says in the winter, Canada often relies on fruits and veggies grown in the United States, but the price of the loonie could drive the cost up.

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“Those things that we get fresh in the winter from the U.S. […] were going to be more expensive anyway and so this just bumps it more. So, we’ve seen quite high levels of food inflation in the last year and I think for those products, that inflation will continue,” he said.

The Canadian dollar declined further a few days ago when the Bank of Canada didn’t raise interest rates as much as expected, but it did finish in the green by week’s end.

“The products in the grocery store that will be most affected will be fresh fruits and vegetables as they start coming out of the U.S. Particularly because they’re coming from the U.S. because our dollar is relative to the U.S. dollar,” von Massow notes.

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Canadians have been grappling with rising costs for everything in their daily lives. A recent report showed an all-time high in Canadians using food banks earlier this year, with inflation and low social assistance rates cited as the main factors, according to Food Banks Canada.

On Wednesday, The Bank of Canada increased its key interest rate for the sixth consecutive time this year, now at 3.75 per cent, marking one of the fastest monetary policy-tightening cycles in its history.

With files from The Canadian Press.

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