This will raise further questions about interest rate hikes by the Bank of Canada.
According to Statistics Canada data released Friday, inflation is up 1% year-over-year. Lower gas prices played a big role in the declining inflation rate.
Inflation has been declining for months, with the rate declining from 1.6% in April to 1.3% in May.
Here some of the key charts released by Stats Can today:
The July figures – which will be released in August – will be the first since the .25% interest rate hike by the Bank of Canada.
The measurement of core inflation – three different measures excluding the most volatile factors such as gasoline – increased to 1.6%, 1.4%, with another staying at 1.2%. Of course, many dismiss the core inflation measurements – since excluding essential items such as food and energy often defeats the purpose of measuring the impact of inflation on Canadians.
Central banks out of ideas
As we are seeing in much of the western world, central banks (despite their outward confidence), are out of ideas. rock-bottom interest rates were supposed to boost inflation and growth, but today’s release of inflation numbers show that hasn’t taken place. Now, central bankers seem lost:
As I noted previously, “However, simultaneously to low inflation and low growth, a massive housing bubble has formed, and household debt has risen to record highs. So, the Bank of Canada is now trying to thread an almost imperceptible needle: Raise rates enough to cool off the housing market and reduce debt levels without causing even lower growth and lower inflation.”
The data released today will only raise the pressure on the Bank of Canada, and should cause a deeper debate about the fragility of our economy, and the failure of those in power to understand the serious consequences of a rigged system that only favours those at the top at the expense of the majority of Canadians.
Whatever the elites may be saying publicly, Canada’s economy is facing serious problems, and sooner or later the contradictions will have to be resolved – which will have clear and lasting consequences for our country.