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ZQ mY In 2020 in Canada: inflation at the lowest level in 12 years - The Times Hub

In 2020 in Canada: inflation at the lowest level in 12 years

In 2020 in Canada: inflation at the lowest level in 12 years

The Consumer Price Index (CPI) recorded its weakest growth in 2020 since the economic crisis of 2008-2009 due to the impacts of the COVID-19 pandemic on the Canadian economy.

On an average annual basis, the CPI rose 0.7% compared to 1.9% in 2019.

The CPI reached the same level in December in the country, 0.7%, down from November 2020 (+ 1.0%).

According to figures released on Wednesday by Statistics Canada, this “deceleration in inflation is mainly attributable to a drop in consumer spending linked to protective measures aimed at restricting travel and encouraging physical distancing during the pandemic,” he said. -on specified by press release.

With more Canadians staying at home than usual with the rise of telecommuting, gas mileage has fallen. Without gasoline, the average annual CPI rose 1.3% in 2020, notes the federal agency.

“The pandemic slowed the price growth of consumer goods and services in 2020 compared to the previous year, which is in part a reflection of how Canadians have adjusted to staying at home, traveling less and by buying more of some items and less of others, ”it said.

It is true that food prices have increased, but the prices of non-durable goods have “fallen due to the decline in gasoline prices, which contributed the most to the slowdown in CPI growth in 2020”, specified Statistics Canada.

Increase for new housing

As for durable goods, the average increase in 2020 was 1.4%, the same level as the previous year (+ 1.3%). We underline here a difference in particular with the last economic crisis, when the prices of durable goods had fallen by -3.1% in 2009.

“In 2020, a sharp drop in vehicle sales at the start of the pandemic coincided with weaker price growth, but this had a moderate effect on the average annual price change, since in August sales had rebounded at the levels observed before the pandemic ”, it was reported, putting into perspective that in 2009 new car sales had“ remained weak for longer ”.

The largest increase in the cost of homeowners’ replacement, which is linked to the price of new homes, was observed in Quebec, where we experienced a 5.9% jump on an average annual basis in 2020. At the scale Canada, we are talking about an increase of 2.0%, compared to a decline of 0.1% in 2019.

“Historically low interest rates, combined with higher costs of building materials and low inventories of homes available for sale, have helped drive new home prices up through 2020,” says Statistics Canada. Costs fell the most in Saskatchewan (-2.6%) and Alberta (-2.0%), which is in part attributable to slower economic activity in the oil and gas sector in those provinces. ”

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