Retail sales in Alberta have now risen for five consecutive months. Part of the increase in total sales may not be rising consumer sentiment, but rather the fact that prices are rising. The rate of annual consumer price inflation shot up to 2.5 per cent in January, the highest level in over two years.
One of the most significant price increases last month was gasoline. Compared to January of 2016, prices at the pump rose 33.9 per cent. A portion of this increase was due to the new 4.49-cents-per-litre carbon levy in the province, implemented January 1. (In February, however, most motorists will have noticed gas prices have plunged, showing how volatile gas prices can be month to month.)
Natural gas, which is also prone to price volatility, skyrocketed 42.3 per cent compared to a year earlier.
Some prices in Alberta actually fell, however, particularly for food purchased in grocery stores. Fresh vegetables dropped a whopping 17.3 per cent year-over-year. Fresh fruit (-9.8), baked goods (-2.6) and meat (-3.9) all dropped in price. And electricity cost 8.2 per cent less.
Nationally, Canada’s inflation rate also rose to the highest in more than two years to 2.1 per cent. Here, as in Alberta, a major factor contributing to the higher rate was gasoline. Prices on average across the country rose by more than a fifth compared to last year.