Inflation in Canada rose at its fastest pace in almost 40 years in the year to May, as the price of almost everything continues to rise rapidly.
Statistics from Canada said on Wednesday that rising gasoline prices were a major factor in the rise. Gas prices rose 12% in May alone, up 48% from a year ago.
Food prices have also been a major driver of the rise, with food bills rising 9.7% in the last year. Within the food category, the price of edible fats and oils rose by 30 percent, the fastest increase in history.
Russia’s invasion of Ukraine is a major factor in this growth, as Ukraine is one of the world’s leading suppliers of sunflower oil, and the war has caused a shortage of basic products for the closet.
WATCH How the war in Ukraine leads to a shortage of sunflower oil:
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Food researchers say the shortage of sunflower oil caused by the war in Ukraine will only get worse.
Economists had expected the pace to rise from a 30-year high of 6.8 percent in April, but figures for May exceeded expectations.
Canada is not the only country struggling with inflation at its highest level in decades. In the US, inflation is currently above 8%, and new data from the United Kingdom show that the cost of living is rising by 9% year on year.
While the rate of inflation in Canada is rising rapidly, no matter how you cut it, the Statistical Office of Canada has made some changes recently in the way it tabs the numbers. These changes have made the problem of inflation seem even bigger than before.
The data agency is updating its inflation basket to include prices for new and used vehicles in its calculations, instead of how they did it before, which was through a proxy. Statscan has also adjusted its inflatable basket to add weight to the cost of shelter.
According to estimates by the data agency, the cost of buying a car has increased by 6.8 percent over the past year. Although this is lower than the overall inflation rate, it is still one of the main factors contributing to the higher overall increase, Statscan said.
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