Canadian inflation surpassed 5 per cent in January for first time since 1991

Canada’s annual pace of inflation topped five per cent for the first time in more than 30 years last month.

Statistics Canada says the rate of inflation rose to 5.1 per cent on a year-over-year basis in January. That’s up from 4.8 per cent recorded in December.

In comparison, the agency says the consumer price index increased 1.0 per cent on an annual basis in January 2021.

“COVID-19 pandemic-related challenges continue to weigh on supply chains, and consumer energy prices remain elevated,” Statistics Canada says. “Taken together, Canadians continued to feel the impact of rising prices for goods and services, especially for housing, food and gasoline.”

#Breaking Canada January CPI climbs to 5.1% (est. +4.8%)
-first time above 5% since Sept. 1991
-Gas prices up 31% y/y
-Shelter costs up 6.2%…fastest since 1990
-Grocery prices up 6.5%@CityNewsTO https://t.co/lPxT58ubQG

— Mike Eppel (@eppman) February 16, 2022

On a monthly basis, the inflation rate rose 0.9 per cent in January 2022, marking the largest increase since the same time in 2017. This followed a 0.1 per cent monthly decline in December 2021.

Meanwhile, on a seasonally adjusted monthly basis, the CPI was up 0.6 per cent.

Statistics Canada notes inflation is often compared with changes to average wages. Citing data from the Labour Force Survey, Statistics Canada says “wages rose 2.4% during the same period, meaning that, on average, prices rose faster than wages and Canadians experienced a decline in purchasing power.”

-With files from The Canadian Press