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Consumer prices rose 1.2% in the 12 months to August, following a 1.3% gain in July. Higher prices for the purchase of passenger vehicles, gasoline, meat and food purchased from restaurants were major factors in the year-over-year increase of the August Consumer Price Index (CPI).

12-month change in the major components

Consumer prices rose for every major component in the 12 months to August, with the exception of clothing and footwear.

Prices for transportation rose 1.8% in the 12 months to August, after rising 1.1% in July. The cost for the purchase of passenger vehicles rose 2.0% and gasoline prices increased 2.2%.

Food prices increased 2.2% year over year in August following a 2.1% advance in July. Leading the August increase were higher prices for meat (+5.7%), food purchased from restaurants (+2.2%), and cereal products (+4.5%). In contrast, prices for fresh vegetables declined.

Shelter costs rose 1.0% in the 12 months to August, matching the increase in July. Increases for homeowner's replacement cost (+2.2%), electricity prices (+3.4%), and rent (+1.4%) were major factors leading to the August rise in shelter costs. Natural gas prices continued to fall on a year-over-year basis.

The only major component which decreased in the 12 months to August was clothing and footwear (-1.2%), led by price declines for women's clothing. At the same time, jewellery prices rose 4.2%.

Energy prices

Energy prices rose 0.8% in the 12 months to August after posting three consecutive months of year-over-year declines.

Gasoline prices rose 2.2% in the 12 months to August, after declining 1.3% in July. The largest year-over-year increases were recorded in Manitoba and Quebec, while New Brunswick was the only province to post a decline in August.

The cost of electricity increased 3.4% year over year in August, after a 3.7% rise the month before. Higher electricity prices in Ontario continued to be the biggest factor in these recent increases.

In contrast, natural gas prices dropped 13.9% in the 12 months to August, continuing a pattern of decreases observed since January 2011. Year-over-year declines in Ontario and Alberta contributed the most to the decrease at the national level.

12-month change in the provinces

Consumer prices in six of ten provinces grew at a larger year-over-year rate compared with Canada. The largest increase was recorded in Quebec's CPI.

Consumer prices in Quebec increased 2.0% in the 12 months to August, after rising 1.9% in July. Prices for gasoline rose 4.6%, more than twice the pace of the national average. This was one of the main factors pushing Quebec's CPI higher in comparison to other provinces. In addition to price gains for gasoline, price increases for food purchased from restaurants, and the purchase of passenger vehicles were main contributors to the August rise in the Quebec CPI.

In Ontario, consumer prices rose 1.0% in the 12 months to August, following a 0.7% increase in July. Higher homeowners' replacement cost and electricity prices led the increase in the provincial CPI, while natural gas prices declined.

In British Columbia, prices increased 1.0% on a year-over-year basis in August after rising 1.1% in July. Prices rose for gasoline, food purchased from restaurants, and electricity.

Prices in Alberta rose 1.0% year over year in August, following a 0.9% gain the previous month. Higher prices for gasoline, property taxes, and the purchase of passenger vehicles were main factors in the August increase in the Alberta CPI.

Seasonally adjusted monthly CPI increases

On a seasonally adjusted monthly basis, the CPI increased 0.4% in August, after decreasing for three consecutive months. Prices rose in August for every major component except for clothing and footwear, and household operations, furnishings and equipment.

The seasonally adjusted index for transportation rose 1.3% in August, following a 0.5% decline in July. The food index rose 0.4% in August, matching the increase recorded the previous month. The index for shelter increased 0.2%, after rising at the same rate in July.

Non-seasonally adjusted monthly CPI increases

On a monthly basis and before seasonal adjustment, the CPI rose 0.2% in August, after declining 0.1% in July.

The cost of transportation rose 0.9% in August after declining 0.9% in July. Gasoline prices rose 2.7% after decreasing 0.1% in the previous month. Costs for the purchase of passenger vehicles increased 1.0% in August.

Electricity costs increased 1.8% in August, led by gains in Alberta.

In contrast, declines were recorded for fresh vegetables (-5.1%), telephone services (-1.3%), fresh fruit (-3.8%), and children's clothing (-6.4%).

At the provincial level, prices rose in every province. The largest increase was in Alberta, where prices rose 0.6% in August, impacted by a monthly increase in electricity prices. Increases in gasoline prices were major contributors to the monthly gains recorded in the Atlantic provinces, Quebec and Ontario.

Bank of Canada's core index

The Bank of Canada's core index rose 1.6% in the 12 months to August, following a 1.7% gain in July.

On a month-to-month basis and before seasonal adjustment, the core index rose 0.3% in August, following a 0.1% decline in July.

On a monthly basis, the seasonally adjusted core index rose 0.3% in August after posting no change in June and July.

Note to readers

The special aggregate "Energy" includes: electricity; natural gas; fuel oil and other fuels; gasoline; and fuel, parts and supplies for recreational vehicles.

The Bank of Canada's core index excludes eight of the Consumer Price Index's most volatile components (fruit, fruit preparations and nuts; vegetables and vegetable preparations; mortgage interest cost; natural gas; fuel oil and other fuels; gasoline; inter-city transportation; and tobacco products and smokers' supplies) as well as the effects of changes in indirect taxes on the remaining components.

A seasonally adjusted series is one from which seasonal movements have been eliminated. Users employing Consumer Price Index data for indexation purposes are advised to use the unadjusted indexes. For more information on seasonal adjustment, see Seasonal adjustment and identifying economic trends.