Canada’s inflation rate reached its highest point in nearly two decades in August as the consumer price index rose 4.1% compared with a year ago.
The rise was driven by the rollback in economic restrictions as well as supply-chain issues, for example a shortage of semi-conductors helped drive up the price of new vehicles by 7.2% year-over-year in August, for the fastest pace since 1994.
Gasoline was up 32.5% and furniture prices rose 8.7% because of the higher cost of lumber - and the cost of meat was also higher by 6.9%. Statistics Canada says the annual inflation number would have been 3.2% last month had it excluded gasoline prices from its calculation.
BMO chief economist Douglas Porter says "the August inflation reading is likely the peak, but the elevated readings may continue for months because of sustained pressure on energy, food and home prices."
Stats-Can says there was also a 19.3% year-over-year rise in traveller accommodation prices across every province as demand increased amid easing travel restrictions.