*Note, if you’re seeing this post for the second time, it’s because it was lost when I made website updates to handle increased traffic.
Even as the Canadian economy slows, the cost of living continues to rise.
The inflation rate surged to 2.2% in February, far above expectations of a 1.7% increase and above the central bank target of 2% according to a Statistics Canada report.
The increase was led by higher gas prices (up 12.6%), as well as higher costs for restaurant meals and more expensive cars.
Additionally, as noted by the CP, “The report also found the average of the agency’s three measures of core inflation, designed to omit the noise of more-volatile items like gasoline, also continued its upward momentum last month and has now climbed slightly above two per cent.”
The surge in inflation makes it more likely that the Bank of Canada will raise interest rates. However, higher interest rates pose their own problem for our economy, as Canadian consumers are heavily indebted.
At the same time, economic growth is slowing, and there is rising concern over a severe collapse in investment. Under the Trudeau government, Canada is increasingly seen as an over-regulated, expensive, and uncertain place to do business, and there’s only so much growth that can be fuelled by taking on tons of debt.
Now, the inflation increase is simply the latest confirmation that the cost of living continues to rise, putting even more pressure on Canadians as we deal with higher taxes and burdensome regulations that make everything even worse economically.