StatsCan: Gas Prices Push Up Consumer Price Index

Consumer prices rose 3.4% in July 2008 compared with July 2007, an increase from the 3.1% rise recorded in the 12 months to June 2008.

Statistic Canada is reporting consumer prices rose 3.4% in July 2008 compared with July 2007, an increase from the 3.1% rise recorded in the 12 months to June 2008. Higher gasoline prices are exerting a strong upward pressure on consumer prices. July saw the highest 12-month increase since March 2003. A climb in gasoline prices was the primary source of higher consumer prices in July. The 12-month variation in the Consumer Price Index (CPI) and the gasoline price index have been increasing at a faster pace over the past four months. Other than gasoline, consumer prices advanced 2.1%, up from the 1.8% 12-month rate of growth posted for June. The impact of rising gasoline prices was partially offset by lower prices to purchase and lease passenger vehicles partially offset and eased the overall increase in transportation costs for consumers. The seasonally-adjusted monthly all-items CPI advanced 0.3% between June and July 2008, down from the 0.8% rise posted in June. Higher natural gas prices (+25.0%) also contributed to the rise in consumer prices in July. The increase in natural gas prices was partly due to a decline in prices that occurred at the same time last year and to recent increases related to oil prices.