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Consumer prices rose 3.1% in the 12-months ending June 2008

Consumer prices rose 3.1% in the 12-months ending June 2008

Fuelled by higher gasoline prices, consumer prices rose 3.1% in the 12-months ending June 2008, compared with the 2.2% gain recorded in May. June's increase was the largest since September 2005. Consumer prices excluding gasoline rose 1.8% in the 12 months to June.
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Gasoline prices increased 26.9% between June 2007 and June 2008, significantly higher than the 15.0% advance posted in May. June's increase was the largest since the 34.7% gain reported for September 2005, when hurricanes Katrina and Rita disrupted the oil market.

June's increase reflected both recent increases in pump prices, as well as the fact that gasoline prices had been on the decline in June 2007.

The Bank of Canada's core index, which is used to monitor the inflation control target, rose 1.5% in June 2008 compared with the same month of the previous year, the same rate of increase posted in May.

On a month-to-month basis, the seasonally-adjusted all-items index rose 0.8% between May and June 2008, while the seasonally-adjusted core index increased 0.3%. The seasonally-adjusted all-items index increased 0.7% and the core index edged up 0.1% between April and May.

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12-month change: Mortgage interest cost also adds upward pressure

In addition to gasoline prices, mortgage interest cost, bakery products and air transportation also exerted strong upward pressure on the Consumer Price Index (CPI) in June.

Mortgage interest cost increased 9.0%. New housing prices continued to exert more upward pressure on this index than mortgage interest rates.

Homeowner's replacement cost, which represents the cost of maintaining a housing structure, rose 3.2% in June, down from the 4.0% rate of growth posted in May. The 12-month increase observed in June was the smallest gain since March 2001.

In June 2008, Canadians spent 3.0% more on store-bought food compared with the same month of the previous year, well above the 1.9% increase reported for May. The strongest upward pressure on this index came from prices for bakery products, which rose 12.3%.

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The price of air transportation rose 14.3%, the largest gain since May 2002. Higher costs were observed across most destinations, with transatlantic flights posting the sharpest price increases. This increase was due in part to a premium charged by carriers to cover higher kerosene prices.

Higher natural gas prices also pushed up consumer prices. The upward pressure from natural gas was especially strong in Alberta.

Mitigating the growth in consumer prices were prices to purchase and lease passenger vehicles, which fell 8.4% between June 2007 and June 2008. This decrease came at a time when some manufacturers introduced new models on the market with incentives.

Prices also fell for computer equipment and supplies (-13.2%). Declines were especially sharp for desktop computers.

Energy drives the all-items index in Prince Edward Island and Alberta

Among the provinces, Prince Edward Island (+4.7%) and Alberta (+4.4%) experienced the most substantial increases in consumer prices, driven mainly by upward pressure from energy components.

Excluding energy components, the largest gain in the all-items CPI occurred in Saskatchewan (+2.6%), where the cost of owned housing exerted the strongest upward pressure.

The smallest increases in the all-items CPI were posted in New Brunswick (+2.1%) and Manitoba (+2.4%).

For a more detailed analysis, consult the publication The Consumer Price Index.

Available on CANSIM: tables 326-0009, 326-0012, 326-0015 and 326-0020 to 326-0022.

Definitions, data sources and methods: survey number 2301.

More information about the concepts and use of the CPI are also available online in Your Guide to the Consumer Price Index (62-557-XIB, free) from the Publications module of our website.

The June 2008 issue of the Consumer Price Index, Vol. 87, no. 6 (62-001-XWE, free), is now available from the Publications module of our website. A paper copy is also available (62-001-XPE, $12/$111). A more detailed analysis of the CPI is available in this publication.

The July Consumer Price Index will be released on August 21.

For more information or to enquire about the concepts, methods or data quality of this release, call Client Services (toll-free 1-866-230-2248613-951-9606; fax: 613-951-1539;, Prices Division.

Consumer Price Index and major components


  Relative importance1 June 2008 May 2008 June 2007 May to June 2008 June 2007 to June 2008
          % change
All-items 100.002 115.4 114.6 111.9 0.7 3.1
Food 17.04 115.8 114.6 112.6 1.0 2.8
Shelter 26.62 122.3 121.6 116.8 0.6 4.7
Household operations and furnishings 11.10 104.3 104.3 103.0 0.0 1.3
Clothing and footwear 5.36 92.5 93.0 93.1 -0.5 -0.6
Transportation 19.88 125.8 123.6 119.2 1.8 5.5
Health and personal care 4.73 108.7 108.6 107.9 0.1 0.7
Recreation, education and reading 12.20 102.9 102.9 102.5 0.0 0.4
Alcoholic beverages and tobacco products 3.07 127.7 127.4 125.7 0.2 1.6
All-items (1992=100)   137.3 136.4 133.2 0.7 3.1
Special aggregates            
Goods 48.78 111.6 110.4 108.9 1.1 2.5
Services 51.22 119.1 118.7 114.8 0.3 3.7
All-items excluding food and energy 73.57 110.3 110.3 109.0 0.0 1.2
Energy 9.38 165.3 158.4 140.1 4.4 18.0
Core CPI3 82.71 111.6 111.5 109.9 0.1 1.5
1. 2005 CPI basket weights at April 2007 prices, Canada, Effective May 2007. Detailed weights are available under the Documentation section of survey 2301 (
2. Figures may not add to 100% due to rounding.
3. The measure of Core Consumer Price Index (CPI ) excludes from the All-items CPI the effect of changes in indirect taxes and eight of the most volatile components identified by the Bank of Canada: fruit, fruit preparations and nuts; vegetables and vegetable preparations; mortgage interest cost; natural gas; fuel oil and other fuel; gasoline; inter-city transportation; and tobacco products and smokers' supplies. For additional information on Core CPI, consult the Bank of Canada website (

Consumer Price Index by province, and for Whitehorse, Yellowknife and Iqaluit1


  June 2008 May 2008 June 2007 May to June 2008 June 2007 to June 2008
        % change
Newfoundland and Labrador 115.4 114.5 111.9 0.8 3.1
Prince Edward Island 119.5 118.9 114.1 0.5 4.7
Nova Scotia 117.8 117.1 113.0 0.6 4.2
New Brunswick 114.5 113.9 112.1 0.5 2.1
Québec 114.1 113.6 110.7 0.4 3.1
Ontario 114.2 113.6 111.1 0.5 2.8
Manitoba 114.4 113.5 111.7 0.8 2.4
Saskatchewan 117.0 116.2 113.1 0.7 3.4
Alberta 124.0 122.2 118.8 1.5 4.4
British Columbia 113.6 112.8 110.3 0.7 3.0
Whitehorse 114.6 113.6 109.7 0.9 4.5
Yellowknife2 116.6 115.7 111.6 0.8 4.5
Iqaluit (Dec. 2002=100) 110.5 109.8 108.0 0.6 2.3
1. View the geographical details for the city of Whitehorse, the city of Yellowknife and the town of Iqaluit.
2. Part of the increase first recorded in the shelter index for Yellowknife for December 2004 inadvertently reflected rent increases that actually occurred earlier. As a result, the change in the shelter index was overstated in December 2004, and was understated in the previous two years. The shelter index series for Yellowknife has been corrected from December 2002. In addition, the Yellowknife All-items CPI and some Yellowknife special aggregate index series have also changed. Data for Canada and all other provinces and territories were not affected.

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Statistique Canada

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