Sat. Jun 22nd, 2024

Analyzing April 2024 Consumer Price Index Trends

By Fatih Sahin May21,2024

In April 2024, the Consumer Price Index (CPI) exhibited a year-over-year increase of 2.7%, a slight deceleration from the 2.9% rise observed in March. The overall deceleration of the CPI was significantly tempered by the prices of gasoline, which saw a notable increase. Gasoline prices rose by 6.1% in April, up from a 4.5% increase in March. When excluding gasoline, the all-items CPI rose by 2.5% year-over-year, down from a 2.8% increase the previous month. On a monthly basis, the CPI saw a 0.5% rise in April, largely driven by gasoline prices, while seasonally adjusted figures indicated a 0.2% monthly increase.

Food prices, a substantial component of the CPI, played a critical role in the overall deceleration. The index for food purchased from stores increased by 1.4% year-over-year in April, down from 1.9% in March. This slowdown was largely attributed to a base-year effect impacting prices for fresh or frozen beef, which had seen a significant rise in April 2023. Additionally, other food categories such as bakery and cereal products, fruit, seafood, and non-alcoholic beverages saw slower price growth or declines.

Food purchased from restaurants also contributed to the easing CPI, with a 4.3% year-over-year increase in April compared to 5.1% in March. Notably, the index remained unchanged month-over-month, influenced by a base-year effect from a 0.8% monthly increase in April 2023.

Gasoline prices rose 6.1% year-over-year in April, following a 4.5% increase in March. This faster growth was driven by a 7.9% month-over-month increase, influenced by factors such as the transition to summer blends, higher oil prices due to supply concerns, and an increase in the federal carbon levy.

Regional analysis revealed that the CPI rose at a slower pace in six provinces in April compared to March. In Alberta, the CPI decelerated year-over-year, partly due to lower electricity and natural gas prices. However, this was offset by a significant 16.2% year-over-year increase in rent, the highest in Canada, driven by strong demand from high net interprovincial migration.

Statistics Canada highlights the robustness of the food price data used in the CPI. Food prices are meticulously gathered using scanner data, the gold standard for price collection, from nearly 500 grocery retailer outlets across Canada.

Furthermore, Statistics Canada emphasizes the importance of using the CPI for comparing prices over time rather than average prices, which can fluctuate due to various factors.

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