Canada’s inflation rate rises to 4.8 per cent

Groceries, appliances and home insurance are all getting more expensive, as Canada’s consumer price index rose 4.8 per cent on a year-over-year basis in December.

The price of groceries rose 5.7 per cent, the largest increase since 2011. Prices for fresh fruit are up 5.6 per cent and baked goods are up 4.7 per cent. Stats Canada attributes this to poor weather conditions in farming regions and supply chain issues.

Canadian homeowners paid 9.3 per cent more for home and mortgage insurance in December 2021 compared with 2020. An increase in the frequency and severity of weather-related claims such as flooding and fires is a contributing factor, along with increases in construction costs due to supply chain issues.

The prices of durable goods such as cars and home appliances have also increased. 

Canadians paid 7.2 per cent more for new vehicles in December of this year than last year, also due to supply chain issues related to semiconductor chips. 

There was also a price increase of 8.9 per cent for household appliances, like refrigerators, freezers, laundry and dishwashing machines in December 2021 compared with December 2020, the biggest increase since 1982.

Month over month, Canadians paid 24.7 per cent more for airfare in December, similar to pre-pandemic numbers. Strong demand for air travel during the holiday season was a large factor. 

Gas prices are the only area that did not see an increase in December. Canadian drivers paid less as gasoline prices fell 4.1 per cent, largely due to tightening COVID-19 restrictions.