Low gas prices continue to benefit Canadians, who appear to be splurging on big-ticket items to deal with the COVID-19 pandemic, according to new inflation figures from Statistics Canada.
Excluding gasoline, the Consumer Price Indexrose 1.3 per cent in November, up from an increase of one per cent in October. Year over year, the CPI rose at a faster pace in November (up one per cent) than in October (up 0.7 per cent) with shelter prices (up 1.9 per cent) contributing the most to the increase.
Gasoline prices fell 11.9 per cent year over year in November, with domestic and international demand remaining low as tighter public health restrictions due to the second wave of COVID-19 continue to depress demand for gasoline.
While consumer confidence remains below pre-pandemic levels, higher consumer spending on household durable goods led to higher prices for furniture (up 2.8 per cent) and household appliances (up 2.9 per cent), according to the agency, whose analysis suggests that Canadians might have engaged in some retail therapy.
“As the household savings rate declined compared with the early months of the pandemic, physical distancing rules encouraging Canadians to stay home may have prompted increased spending on big-ticket items for the home,” a report reads.
Canadians also spent more on housing.
Rents rose 1.5 per cent during the 12 months to November, up from an increase of one per cent in October.
“While year-over-year growth in rent prices remained below pre-pandemic levels, November marked the fifth month-over-month increase in six months, with the lone decrease occurring in July,” it read.
Canadians also spent more on new homes as the so-called homeowners’ replacement cost index linked to the price of new homes rose 1.1 per cent month in November, the ninth consecutive monthly increase.
“Historically low interest rates coupled with a shift in home buyer preferences toward larger spaces continued to fuel demand for single-family homes,” it reads. “This higher demand and the combination of higher building material costs and low inventory of homes for sale in some markets contributed to rising prices for new housing.”
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