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Consumer Price Index
In November 2004, Canadian consumers paid 2.4% more than in November 2003 for the goods and services included in the Consumer Price Index (CPI) basket. This increase followed a 2.3% rise in October. This 0.1% difference is due to a larger than usual monthly increase in the automotive vehicle prices in November.
The 12-month increase in the CPI excluding energy was 1.6% in November. This increase has remained relatively stable over the past six months, ranging between 1.4% and 1.6% since June 2004.
The All-items index excluding the eight volatile components identified by the Bank of Canada rose by 1.6% between November 2003 and November 2004, slightly more than the 1.4% recorded in October 2004.
Percentage Change from the Same Month of the Previous Year, Canada
Between October and November, the CPI rose by 0.4%. The decrease in gasoline prices was not sufficient to offset the increase in prices for automotive vehicles.
On a monthly basis, the All-items index excluding the eight volatile components identified by the Bank of Canada was up 0.5%, while it had remained stable in October. November’s increase was mostly the result of higher automotive vehicle prices.
Twelve-month percentage change in the CPI: +2.4%
Twelve-month percentage change in the CPI excluding energy: +1.6%
In November, the CPI registered a 2.4% increase over November 2003. Upward pressure was exerted primarily by gasoline prices, homeowners’ replacement cost, as well as prices for fuel oil and cigarettes.
These price increases were nonetheless moderated by lower prices for computer equipment and supplies, automotive vehicle insurance premiums and traveller accommodation.
On average, gasoline prices in November 2004 were 17.7% higher than those of November 2003. Residents of Prince Edward Island experienced the largest increase (+27.1%), followed closely by those of Alberta (+26.5%) and Manitoba (+26.2%). The smallest increases were noted in Ontario (+14.7%) and British Columbia (+15.2%).
Homeowners’ replacement cost, which represents the worn out structural portion of housing and is estimated using new housing prices (excluding land), rose 6.4% from November 2003. Costs for construction materials were affected by the increase in energy prices since a number of them are derived or produced using petroleum or natural gas, including plastic, cement, glass, and asphalt shingles. Costs for transporting these materials were also higher. Increased demand for labour in the construction industry was another factor behind the higher prices.
Fuel oil prices rose 42.6% between November 2003 and November 2004, representing the largest 12-month increase since March 2003 (+62.1%). Concerns over the world supply capacity and strong demand for fuel oil in anticipation of winter pushed prices up.
The increase in tobacco taxes over the past 12 months is responsible for most of the 6.9% rise in cigarette prices since November 2003. The highest increase was posted in Ontario (+12.0%) and the lowest in Alberta (+1.6%).
A number of factors exerted a moderating effect on the 12-month increase in the All-items index. These included the index for computer equipment and supplies, which dropped by 19.2% since November 2003.
A 1.6% decrease in automotive vehicle insurance premiums also exerted a dampening effect on the 12-month increase in the All-items index. Legislative changes led to lower premiums in the Atlantic provinces, Ontario and Alberta.
Prices for traveller accommodation dropped 6.0% in November 2004 as compared with November 2003. A drop in the number of visitors from the United States and higher room inventories were some of the factors quoted as having affected the industry.
Monthly percentage change in the CPI: +0.4%
Monthly percentage change in the CPI excluding energy: +0.6%
Between October and November, the CPI increased by 0.4%. Higher prices for the purchase and leasing of automotive vehicles and fresh vegetables were the main factors behind this increase. Lower prices for gasoline, traveller accommodation and women’s and men’s clothing nonetheless moderated this increase.
The index for the purchase and leasing of automotive vehicles was up 6.4% from October to November 2004. In November of each year, models of automotive vehicles from the current year (2004) are replaced by the new models (2005) in the CPI sample. When the old models are compared to the new models, only pure price changes are incorporated in the index, as the CPI compares goods and services of equivalent quality. Price increases that are a consequence of an improvement in the quality of the product are factored out of the index.
This monthly increase was steeper than that of last year, as the financial incentives between July and October this year were more substantial than those of last year. However in November 2004, the index for the purchase and leasing of automotive vehicles was only 0.2% higher than in November 2003.
Purchase and leasing of automotive vehicles, Canada
In contrast with the previous month, gasoline prices were down 5.0% in November 2004. Price reductions were recorded in all provinces except Prince Edward Island (+3.2%), where prices are legislated.
Prices for traveller accommodation plunged 9.5% in November. Lower prices are normal for November, since demand in most areas continues to drop as compared with the summer’s peak tourist season.
Consumers were able to take advantage of numerous discount sales on clothing in November. In general, prices for women’s clothing were down 4.4%, while those for men decreased 2.2%. In both cases, the monthly decreases recorded were the largest for any month of November since these series started, in 1982.
The seasonally adjusted CPI rose 0.3% between October and NovemberSeasonally adjusted, the CPI increased by 0.3% from October to November 2004.
Upward pressure came from the indexes for transportation (+1.5%); shelter (+0.3%); food (+0.2%); recreation, education and reading (+0.2%); and household operations and furnishings (+0.2%).
The index for alcoholic beverages and tobacco products remained stable in November.
The indexes for clothing and footwear (-0.5%); and health
and personal care
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 1.6% between November 2003 and November 2004. The main contributors to this increase were homeowners’ replacement cost (+6.4%), prices for electricity (+5.7%) and restaurant meals (+2.9%), as well as property taxes (+4.3%). These increases were partially offset by lower prices for computer equipment and supplies (-19.2%) and automotive vehicle insurance premiums (-1.6%).
From October to November 2004, the All-items index excluding the eight
volatile components identified by the Bank of Canada increased by 0.5%,
primarily under the influence of higher prices for the purchase and leasing
of automotive vehicles (+6.4%). Lower prices for traveller accommodation
(-9.5%) and women’s clothing
The energy index climbed 12.0% between November 2003 and November 2004. The primary factor that contributed to the upward pressure was prices for gasoline (+17.7%). Higher prices for fuel oil (+42.6%) and electricity (+5.7%), as well as for fuel, parts and supplies for recreational vehicles (+11.1%) also contributed to pushing the index up. These increases were offset to some degree by a decrease in natural gas prices (-3.7%).
On a monthly basis, the energy index decreased by 2.1%, primarily as a result of the decline in gasoline prices (-5.0%), although prices for fuel, parts and supplies for recreational vehicles (-0.9%) were also down. Prices for fuel oil (+5.5%) and natural gas (+1.7%) were the only factors that served to slow down the drop in energy prices, since electricity prices remained stable between October and November 2004.
Goods and services
Prices in the goods sector rose 2.7% between November 2003 and November 2004.
This increase is fully attributable to the 5.7% rise in the non-durable goods index. Again in November, gasoline prices played the largest part in this increase, shooting up 17.7% compared to November 2003. Higher prices for fuel oil (+42.6%), cigarettes (+6.9%), and electricity (+5.7%) also exerted upward pressure on this index. The increase in the non-durable goods index was attenuated by the 1.0% decreases in the durable and semi-durable goods indexes. Prices for computer equipment and supplies (-19.2%) once again accounted for the major portion of the decrease in prices for durable goods, followed by prices for video equipment (-7.8%). Higher prices for the purchase of automotive vehicles (+1.0%) partially offset these reductions. The downward pressure on the semi-durable goods index was largely the result of lower prices for women’s clothing (-1.7%) and men’s clothing (-1.8%). Higher prices for newspapers (+4.8%) and school textbooks and supplies (+2.2%) moderated this downward pressure..
The services index rose 2.2% from November of last year. Increases in
homeowners’ replacement cost (+6.4%) and property taxes (+4.3%)
were the main factors behind this increase. Lower prices for automotive
The goods index increased by 0.5% between October and November 2004.
The increase in the index for durable goods (+3.1%) was partly counterbalanced
by the decrease in the indexes for semi-durable goods (-1.8%) and non-durable
Between October and November 2004, the cost of services rose 0.2% on average. The largest portion of this increase came from higher prices for the leasing of automotive vehicles (+6.3%), while prices for traveller accommodation (-9.5%) accounted for most of the downward pressure.