As inflation slows in Canada, the gap to food inflation widens. So the grocery bill isn’t going down anytime soon.
In Canada, inflation was 4.3% in March, compared with 5.2% in February, according to Statistics Canada’s Consumer Price Index (CPI) released yesterday. In Quebec, it was 4.7% in March, compared to 5.6% in February.
The prices on the supermarket shelves are still tending to be high. The increase in food prices in March was 9.7% for groceries. In March 2022, the reference month of the last calculation, it was still 8.7%.
- Over QUB radioMichel Girard talks about slowing down inflation:
If you add restaurants (+7.1%), March food inflation in Canada was 8.9%. At 4.6 percentage points above inflation, this is the widest gap since 2009.
“It’s one of the components that drives up inflation, even when food prices, like energy, are very volatile,” notes Benoit Durocher, senior economist at Desjardins Group.
Because of this, energy and food are often excluded from inflation calculations to get a better picture.
“But people can’t remove them from their shopping baskets,” he admits.
For the month of March, two food categories contributed more than the others to the price increase: baked goods (+2% in a month) and dairy products (+1.1% in a month).
Anyway, good news
On the good news side, expert Sylvain Charlebois notes that price falls have been observed in four categories: meat, fish, fruit and vegetables.
“These are important categories, but it’s too early to say that going to the grocery store will stop,” says the Dalhousie University researcher.
More good news according to Benoit Durocher: The prices for fertilizers on the international markets are improving “significantly”.
“The correlation between the price of food and the price of fertilizer is still quite good. We’re fairly confident that food prices will follow the same trend; even if it may already have started,” says the economist.
In fact, food inflation rose to 9.7% in March from 10.6% in February.
Blame the grocers?
On Monday, it was Costco’s turn in Ottawa to tell members of the House of Commons Agriculture and Food Committee that the company had not exploited food inflation to over-fortify.
Canadian Costco customers pay a price that depends on many factors, said Costco Wholesale International and Canada executive vice president and chief operating officer Pierre Riel.
He was the fifth in line to come and respond to MPs who are conducting a study on food basket price increases.
Metro, Loblaw, Empire and Walmart CEOs have all said they will not use inflation to boost profits.
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