That’s because they show that fresh vegetable prices were up 18.2 percent in January over the same month of 2015.
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But sharply rising costs on imported food stemming from the loonie’s sharp plunge over the past year are being passed into retail prices, as well.
“The bulk of the disinflationary impulse from lower energy prices is now in the rear-view mirror and inflation is more likely to move higher than lower over the next year”, said James Marple, senior economist at TD Economics.
The annual core inflation rate, which strips out the prices of some volatile items and is watched by the Bank of Canada, was also 2 percent, slightly higher than expected and up from 1.9 percent in the previous month. The reason for the dollar’s weakness is of course the sinking price of oil. Natural gas was down 18.6 per cent, fuel oil down 15 per cent and telephone services 2.5 per cent. The data underlined expectations the Bank of Canada will keep monetary policy unchanged next month.
The month-on-month fall far exceeded the 0.6 percent drop predicted by analysts in a Reuters poll and was the largest such decline since April 2010.
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Experts said the decrease was largely due to unseasonably warm weather in December and the impact of Black Friday shopping events that led to stronger numbers in November. They also went down in every province except for Prince Edward Island, where they ticked up 0.1 per cent. Gasoline costs rose 2.1 percent, the first increase since October 2014, Statistics Canada said.
