Analysis
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Consumer prices rose 3.7% in the 12 months to May, the largest increase since March 2003. This follows a 3.3% increase posted in April. The increase in May was primarily due to higher gasoline prices.
Energy prices advanced 16.6% during the 12 months to May, following a 17.1% increase in April. Gasoline prices rose 29.5%, the largest increase since September 2005 when prices rose in the aftermath of Hurricane Katrina. The latest year-over-year increase follows a 26.4% gain in April, and leaves the gasoline index just below the peak level reached in July 2008. Prices were also higher for fuel oil (+28.2%) and electricity (+0.9%), while they declined 5.3% for natural gas.
Excluding gasoline, the Consumer Price Index (CPI) rose 2.4% in the 12 months to May, following a 2.2% rise in April.
Prices for food purchased from stores rose 4.2% in the 12 months to May, after posting a 3.7% gain in April. Prices increased for many staples, such as meat, bread and fresh milk. Prices for food purchased from restaurants increased 3.2%, following a 2.8% rise in April.
12-month change: Transportation posts largest increase
On a year-over-year basis, prices increased at a faster rate in May than in April in all major components except shelter.
The cost of transportation increased 9.1% in the 12 months to May, the largest year-over-year gain since September 2005. The increase in May followed an 8.3% gain in April. In addition to paying more for gasoline, consumers paid 5.0% more in passenger vehicle insurance premiums; prices for air transportation and the purchase of passenger vehicles also advanced.
Food prices rose 3.9% in the 12 months to May, after increasing 3.3% in April. Increases among food items were widespread. The cost of meat rose 5.4%, as prices increased for beef, pork and chicken. Consumers paid more for both bakery and dairy products, including bread (+10.6%), fresh milk (+4.3%) and cheese (+3.2%). Prices for fresh fruit and vegetables also rose.
Shelter costs rose 1.8% in the 12 months to May, following a 2.3% increase the previous month. In addition to higher prices for fuel oil and electricity, homeowners' replacement cost increased 2.1%. However, mortgage interest cost, which measures the change in the interest portion of payments on outstanding mortgage debt, decreased 1.9%. Natural gas prices also fell.
Prices for recreation, education and reading went up 2.4% in May. Consumers paid more for the use of recreational facilities and services. However, prices for video equipment fell.
Clothing and footwear prices rose 1.1% following a 1.1% decrease in April. Consumers paid more for men's clothing and children's clothing.
Provinces: Gasoline still a factor in every province
Consumer prices increased at a faster rate in May compared to April in eight provinces, largely the result of higher prices at the pump. Ontario recorded the largest increase in gasoline prices (+35.6%) and British Columbia the smallest (+20.7%).
Nova Scotia had the fastest year-over-year increase in consumer prices for the fifth consecutive month (+4.6%).
In Ontario, consumer prices went up 4.0% in the 12 months to May, after rising 3.6% in April. In addition to higher gasoline prices, food purchased from stores increased 5.4%. Passenger vehicle insurance premiums and homeowner's replacement cost also increased. Prices for natural gas fell.
In Quebec, consumer prices increased 3.5% following a 3.2% gain in April. Gasoline prices rose 27.0%. Consumers in Quebec also paid more for fuel oil, food purchased from restaurants, meat and women's clothing.
Prices in British Columbia went up 3.1% in the 12 months to May, following a 2.7% increase in April. In addition to paying more for gasoline, consumers in this province paid more for food purchased from restaurants as well as for homeowners' home and mortgage insurance.
In Alberta, prices advanced 2.8% in May. Alberta drivers paid 29.2% more for gasoline. Prices for natural gas, which tend to be volatile in this province, rose 17.4%. The cost of homeowners' home and mortgage insurance also went up. Consumers in the province paid 8.9% more for bakery products in May.
Non-seasonally adjusted monthly CPI
Consumer prices, before seasonal adjustment, rose 0.7% from April to May. The increase follows a 0.3% gain the month before. On a monthly basis, prices increased in six of the eight major components.
Transportation costs increased 1.3% in May, after increasing 1.9% in April. Prices for gasoline rose 2.0% on the heels of a 6.4% increase in April. Passenger vehicle insurance premiums and the cost of purchasing passenger vehicles also increased.
Food prices gained 0.6% following a 0.2% decrease in April. Prices for food purchased from stores rose 0.7% in May, after falling 0.4% in the previous month. Consumers paid more for fresh fruit, meat and dairy products. Prices for fresh vegetables fell 1.8%
Prices for recreation, education and reading rose 1.0% in May. Consumers paid more for traveller accommodation.
The household operations, furnishings and equipment price index increased 0.5% after falling 0.5% in April. The cost of internet access services rose 3.4%.
Prices for clothing and footwear gained 0.6% in May, after posting a decrease of 1.4% the month before. Consumers paid more for men's clothing and athletic footwear.
Overall, the shelter index remained unchanged in May. The cost of electricity and fuel oil fell. Conversely, homeowners' replacement cost increased.
At the provincial level in May, prices rose in every province except Newfoundland and Labrador, where prices remained unchanged overall.
Manitoba posted the largest increase in consumer prices (+1.0%). Significant increases were also observed in Ontario and Saskatchewan.
In Alberta, consumer prices rose 0.1% after having gone up 1.2% in April. The smaller increase in May is largely due to a decrease in electricity prices.
Seasonally adjusted monthly CPI
On a seasonally adjusted monthly basis, consumer prices rose 0.2% from April to May, after increasing 0.3% the month before.
The food index rose 0.5% while the household operations, furnishings and equipment index increased 0.6%. The transportation index, which includes gasoline, advanced 0.2% following a 1.0% rise in April.
The clothing and footwear index posted a monthly gain of 2.0%, after decreasing 1.1% in April. The alcoholic beverages and tobacco products index rose 0.5% in May.
Bank of Canada's core index
The Bank of Canada's core index advanced 1.8% in the 12 months to May, following a 1.6% gain in April.
On a month-over-month basis and before seasonal adjustment, the core index rose 0.5% in May, after increasing 0.2% in April.
The seasonally adjusted monthly core index increased 0.2% in May, after rising 0.3% in April.
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