Canada’s inflation in November remained at 4.7% on an annual basis, primarily because of increasing prices for gasoline, food and shelter, according to data released by Statistics Canada on Wednesday.
From the previous month, consumer prices rose slightly, by 0.2%. Excluding food and energy, the consumer price index rose at a more moderate annual pace of 3.1%, slightly down from the previous month.
Canadians are feeling the pinch in their wallets every time they head to the pump or the grocery store. Gasoline prices grew at an astronomical rate of 43.6% from a year earlier, while food prices rose at their fastest pace since January 2015. In the meantime, wages have not kept up, rising by 2.8% during the same period.
Heat waves and droughts this year had resulted in a low crop yield, making it more expensive for farmers to feed their livestock. At the same time, delays because of supply chain bottlenecks also drove up prices for fresh produce, whose delivery is time-sensitive.
Buying and owning a home is also more expensive than ever. Prices of owned accommodations rose by 5.3% from a year earlier, a reflection of the heated housing market that keeps pushing to new heights, while utilities also went up by 8.9%.
Consumer prices are unlikely to ease in the immediate future. The floods in British Columbia, which cut off the Port of Vancouver from the rest of Canada, worsened supply chain disruptions. The omicron variant sowed new uncertainties in global oil demand as well as in the movement of goods.
That is not to say that the data was all bad news. There is usually a time lag between inflation and wages, with the latter being stickier and taking longer to shift. But with the tight labor market, and wages already increasing substantially for job hoppers, we will soon see rising wages to match inflation.