Canada consumer prices fall 0.2% in April 2020

OTTAWA, Canada – Consumer prices in Canada declined 0.2% in April, the first year-over-year drop since September 2009, the national statistics institute reported on Wednesday, May 20.

Plunging energy prices as a result of the coronavirus pandemic was the main contributor to the decline in inflation, which had fallen to 0.9% in March.

Excluding energy, the consumer price index rose 1.6% in April.

On a seasonally adjusted monthly basis, the index fell 0.7% in April. Minus food and energy, it was down 0.1%.

Gasoline prices fell a staggering 39.3% in April compared to the same month last year, the largest year-over-year decline on record, according to Statistics Canada.

Limits on air travel, temporary business closures, and falling global trade suppressed demand for oil at a time when markets were already glutted because of tensions between major oil producing countries.

Consumers also benefited from – albeit it more modest – declines in prices for transportation, apparel, and leisure.

But food prices jumped 3.4%, the most of any component of the price index.

The increase was driven by increased demand for dry and canned goods by a population under lockdowns, as well as big markups in prices of rice (9.2%), eggs (8.8%), and margarine (7.9%).

The rise in sales and supply problems created by the pandemic also contributed to jumps in the price of pork (9%) and beef (8.5%) in April compared to the same month a year ago.

Household cleaning products also were up, 4.6%, and paper supplies, which includes toilet paper, rose 6%, the biggest monthly increase on record.  

Prices for lodging, on the other hand, fell 9.8% year-over-year in April, the biggest decline in that category since 2011. – Rappler.com