Highlights
In October 2004, Canadian consumers paid 2.3% more than in October 2003 for the goods and services included in the Consumer Price Index (CPI) basket. This increase follows a 1.8% rise in September 2004.
Gasoline prices were the primary reason for the large increase in the 12-month change in the All-items index between September and October. The 12-month advance in the All-items index excluding energy rose only slightly in October, to 1.5% from 1.4% in September 2004.
The 12-month increase in gasoline prices soared from 7.2% in September to 20.3% in October as a decrease in gasoline prices between September and October of last year (-6.6%), combined with an increase this year (+4.8%), served to widen the gap between the 2003 and 2004 indexes in October as compared to what it was in September.
Gasoline, Canada, Indexes 1992=100
The All-items index excluding the eight volatile components identified by the Bank of Canada rose by 1.4% between October 2003 and October 2004, slightly less than the 1.5% rise recorded in August and September 2004.
Between September and October, the CPI increased by 0.2%, mainly as a result of higher gasoline prices.
On a monthly basis, the All-items index excluding the eight volatile components identified by the Bank of Canada remained stable in October, in the wake of a 0.3% increase in September.
Twelve-month percentage change in the CPI: +2.3%
Twelve-month percentage change in the CPI excluding energy: +1.5%
In October, the CPI registered a 2.3% increase over October 2003. The main factors of this rise were gasoline, homeowners' replacement cost, cigarettes, fuel oil and property taxes.
These increases were however moderated by lower prices for the purchase and leasing of automotive vehicles, computer equipment and supplies, traveller accommodation and insurance premiums for automotive vehicles.
On average, gasoline prices were 20.3% higher in October 2004 than in October 2003. Residents of New Brunswick , Quebec , Manitoba and Alberta experienced the largest increases at 22.2 % , while Saskatchewan residents experienced the smallest at 15.1 % .
Percentage Change from the Same Month of the Previous Year, Canada
Homeowners' replacement cost, which represents the worn out structural portion of housing and is estimated using new housing prices (excluding land), rose 6.5% from October 2003.
Increases in tobacco taxes over the last 12 months explain most of the 7.4% rise in cigarette prices since October 2003. The highest increase was recorded in Ontario (+13.3%) and the lowest in New Brunswick (+1.2%).
Fuel oil prices rose 38.4% between October 2003 and October 2004, the largest increase since March 2003. Concerns over the world supply capacity and strong demand for fuel oil in anticipation of winter pushed prices up.
Changes to property taxes (including special charges) are computed into the CPI once a year in October. This year, the index rose by 4.3%, the largest advance since 1992. The strongest increase was recorded in Prince Edward Island (+7.0%) and the lowest in Manitoba (+2.4%).
The index for the purchase and leasing of automotive vehicles, which was down 2.5% in October 2004, was among the factors that exerted a moderating effect on the 12-month All-items index. Financial incentives, particularly for light trucks and sport utility vehicles, mostly explain the decrease.
As well, prices for computer equipment and supplies plunged 18.9% since October 2003.
Prices for traveller accommodation were down 5.5% in October 2004. A drop in the number of visitors from the United States , as well as a higher room inventory are quoted as factors having affected the industry.
A 1.2% decrease in insurance premiums for automotive vehicles exerted a dampening effect on the increase in the All-items index. Declines in premiums were observed in the Atlantic provinces, as well as in Ontario, following legislative changes in these provinces.
Monthly percentage change in the CPI: +0.2%
Monthly percentage change in the CPI excluding energy: +0.1%
Between September and October, the CPI increased by 0.2%. Advances in gasoline prices, property taxes, as well as in prices for fresh vegetables and fuel oil were moderated by lower prices for natural gas, traveller accommodation, the purchase and leasing of automotive vehicles and computer equipment and supplies.
After four months of decreases, gasoline prices rose 4.8% between September and October 2004.
The property tax (including special charges) index was up by 4.3%. Property taxes are captured in the CPI once a year in October and are assumed to remain unchanged for the rest of the year. That is why, although the change measured is in effect a year-to-year variation, it also affects the monthly change in the CPI.
As a result of lower crop yields in Canada and bad weather in the United States, the 9.5% monthly price increase for fresh vegetables was the highest for a month of October since 1990. The increase in prices for tomatoes (+34.6%), lettuce (+17.6%) and "other fresh vegetables" (+8.0%) was slightly attenuated by lower prices for locally harvested potatoes (-14.3%).
Canadians paid 9.3% more for fuel oil in October 2004. Raw material prices accounted for the major portion of this increase. The sharpest rise was observed in Quebec (+20.1%), but average prices were also lowest in that province.
Among the factors that served to moderate the increase in the monthly index were natural gas prices which fell 7.4% from September to October 2004. Decreases were observed in all provinces except Manitoba and Saskatchewan, where prices remained stable.
Traveller accommodation prices dropped by 9.2% in October, as new rates came into effect following the summer high season.
The index for the purchase and leasing of automobile vehicles declined by 1.0% from September to October 2004. In all provinces, financial incentives triggered drops ranging from 0.7% and 1.6%. The incentives were mainly directed to vans and light trucks.
Computer equipment and supplies also served to bring down the index, with an average reduction in prices of 7.4%. A revision of the data reported for monitors and printers accounts for approximately two thirds of this decrease (-4.7%).
The seasonally adjusted CPI rose 0.4% from September to October
Seasonally adjusted, the CPI increased by 0.4% from September to October 2004.
Upward pressure came from the seasonally adjusted indexes for shelter (+0.5%), transportation (+0.6%), food (+0.6%), clothing and footwear (+0.5%), as well as for alcoholic beverages and tobacco products (+0.2%).
The seasonally adjusted index for recreation, education and reading remained stable.
The seasonally adjusted indexes for household operations and furnishings (-0.2%), and health and personal care (-0.2%) moderated the increase.
Special aggregates
All-items index excluding the eight most volatile components (Bank of Canada definition)
The All-items index excluding the eight volatile components identified by the Bank of Canada increased by 1.4% from October 2003 to October 2004. The main contributors to this increase were homeowners' replacement cost (+6.6%), property taxes (+4.3%), restaurant meal prices (+2.6%) and electricity prices (+4.5%). The advance was partly offset by lower prices for the purchase and leasing of automotive vehicles (-2.5%) and computer equipment and supplies (-18.9%).
From September to October 2004, the All-items index excluding the eight volatile components identified by the Bank of Canada remained stable. The primary factors that contributed to the downward pressure were prices for traveller accommodation (-9.2%), computer equipment and supplies (-7.4%) and the purchase and leasing of automotive vehicles (-1.0%). The property tax index exerted the strongest upward pressure (+4.3%).
Energy
The energy index was up 13.1% from October 2003 to October 2004, due mostly to the rise in gasoline prices (+20.3%) and fuel oil prices (+38.4%). Higher prices for electricity (+4.5%), as well as for fuel, parts and supplies for recreational vehicles (+11.4%) also contributed to pushing the index up . These increases were offset to some degree by a decrease in natural gas prices (-1.4%).
On a monthly basis, the energy index rose by 2.1%, primarily as a result of the increase in gasoline prices (+4.8%). Natural gas prices alone (-7.4%) served to slow down the climb in the energy index, since prices for fuel oil (+9.3%), electricity (+0.3%) and fuel, parts and supplies for recreational vehicles (+2.4%) also increased.
Goods and services
Prices in the goods sector rose 2.8% between October 2003 and October 2004.
This increase is fully attributable to the 6.1% rise in the non-durable goods index. Again in October, it was gasoline prices that played the largest part in this increase, shooting up 20.3% over 12 months. Higher prices for cigarettes (+7.4%), fuel oil (+38.4%) and electricity (+4.5%) also exerted upward pressure on this index. The increase in the non-durable goods index was attenuated by the 1.9% reduction in the durable goods index and the 0.1% decrease in that for semi-durable goods. The majority of durable goods posted price reductions over 12 months, the most substantial decrease coming from computer equipment and supplies (-18.9%). The major factors in the upward pressure on the semi-durable goods index, namely higher prices for women's clothing (+1.2%), newspapers (+3.9%) and school textbooks and supplies (+2.2%), were more than offset by lower prices for toys, games and hobby materials (-3.6%), as well as for children's clothing (-2.8%) and kitchen utensils (-9.9%).
The services index rose 1.9% from October of last year. Increases in homeowners' replacement cost (+6.5%), property taxes (+4.3%) and restaurant meal prices (+2.6%) were the main factors behind this increase. Lower prices for automotive vehicle leasing (-8.8%) were the main factor of the downward pressure.
The goods index increased by 0.3% between September and October 2004, the increases in the indexes for non-durable goods (+0.9%) and semi-durable goods (+0.6%) having been partly counterbalanced by the decrease in the durable goods index (-1.0%).
Between September and October 2004, the cost of services rose 0.2% on average. The largest portion of this increase came from higher property taxes (+4.3%), while prices for traveller accommodation (-9.2%) accounted for most of the downward pressure.
|