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Canada. Consumer Prices rise

Consumer prices rose 0.1% in October compared with October 2008, following a 0.9% decline in September. This was the first 12-month increase since May 2009.



The rise in the all-items Consumer Price Index (CPI) was mostly due to less downward pressure from gasoline prices. Gasoline prices in October 2009 were 13.1% below the level in October last year, compared with a 23.0% drop between September 2008 and September 2009.

Energy prices fell 12.7% between October 2008 and October 2009, following a drop of 18.7% in September.

Excluding energy, the CPI rose 1.4% in the 12 months to October, slightly higher than the 1.3% increase in September.

In October, six major components in the CPI recorded price increases. Higher prices were most significant in food, household operations, furnishings and equipment, and recreation, education and reading.

Seasonally adjusted monthly CPI increases

On a seasonally adjusted monthly basis, the CPI rose 0.4% from September to October, after rising 0.1% from August to September.

The seasonally adjusted monthly CPI has gone up in five of the past six months.

12-month change: Six of the eight major components in the CPI record increases

Major components in the CPI recording price increases in October were: food; household operations, furnishings and equipment; recreation, education and reading; health and personal care; clothing and footwear; and alcoholic beverages and tobacco products.

Food prices went up 2.3% during the 12-month period to October, on the heels of a 2.8% rise in September. October's increase was the smallest since May 2008.

Food costs continued to be pushed up by higher prices for food purchased from stores (+2.1%). Prices for meat increased 2.1% while prices for fish, seafood and other marine products rose 7.9%.

Price increases were also observed for dairy products and eggs (+1.7%) and food purchased from restaurants (+2.7%). Prices fell for fresh fruit and fresh vegetables in the 12 months to October.

Higher prices for household operations, furnishing and equipment were widespread. Upward pressure came from costs of household goods and services, household furnishings and equipment, child care and domestic services, and communications.

As well, recreation, education and reading costs advanced 1.5% year over year in October. Major contributors to the increase were tuition fees (+4.1%) and reading material and other printed material (+6.8%). In contrast, prices for computer equipment and supplies and other electronic equipment items such as video, audio, and photographic equipment continued to fall.

Broad-based price advances occurred in the health and personal care component (+3.4%).

Transportation remained the most significant downward contributor in the CPI, falling 3.1% in the 12 months to October. In addition to lower prices for gasoline, consumers paid 4.1% less for purchasing passenger vehicles, following a 5.9% decrease in September. A 7.7% increase in passenger vehicle insurance premiums tempered the overall drop in the transportation component.

Shelter costs fell 1.6% between October 2008 and October 2009. The decline was mainly the result of persistent price decreases in natural gas (-30.3%), fuel oil and other fuels (-29.4%), and homeowner's replacement cost (-3.1%). Shelter costs were also pushed down by downward pressure from mortgage interest costs.

The mortgage interest cost index, which measures the change in the interest portion of payments on outstanding mortgage debt, fell 3.1% in October following a 2.2% decrease in September.

A 7.2% increase in homeowners' maintenance and repairs costs and a 4.3% rise in property taxes slowed the decline in the shelter price index.

Provinces: Consumer prices up in six provinces

Consumer prices rose in six provinces in the 12 months to October.

Gasoline price declines ranged from 18.1% in Manitoba to 10.5% in Ontario in the 12 months to October. In comparison, price drops for gasoline ranged from 26.0% to 20.0% in September.

Consumer prices rose at the fastest pace in Quebec and New Brunswick, both at 0.5%.

In Ontario, consumer prices increased 0.2%. The growth was due primarily to the rise in passenger vehicle insurance premiums (+11.3%) and property taxes (+5.5%). As well, the cost of electricity went up 8.2%.

Prices in Alberta went up 0.1% in the 12 months to October. This was the first positive year-over-year change since March 2009.

Prices in British Columbia (-0.6%) were down for the fifth consecutive month. This decrease was mainly due to the downward movement in the shelter index (-3.2%), which was a much larger drop than the 1.6% decline nationally.

12-month change in the Bank of Canada's core index

The Bank of Canada's core index advanced 1.8% over the 12 months to October, following a 1.5% rise in September.

The seasonally adjusted monthly core index increased 0.2% from September to October, following a 0.1% increase in September.

Note: Data on tuition fees in Manitoba in the October 16, 2009 release of the CPI for the reference month of September have been corrected. The correction does not affect the all-items CPI for Canada, but does have an impact on the all-items index for Manitoba. The recreation, education and reading index and related sub-components for Manitoba and Canada were also changed.
© Statistics Canada -


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