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February 27, 2019ANALYSIS OF NOVA SCOTIA'S CONSUMER PRICE INDEX FOR JANUARY 2019 A NOTE ON THIS MONTH'S CONSUMER PRICE INDEX
On February 27, 2019, with the release of the January 2019 CPI, the basket of goods and services used in the calculation of the CPI will be updated using 2017 weights. The base year, in which the CPI is set to equal 100, remains 2002.
The 2017 basket classification system will be updated to add new, relevant goods and services, while removing some that are obsolete. Some minor changes will be made to published index titles in order to clarify the definition of some series.
The alcoholic beverages and tobacco products major component has been updated to include recreational cannabis. Additionally, medicinal cannabis has been added under medicinal and pharmaceutical products.
There is also a change to the calculation of the rent index. Month over month changes to the rent index will not be impacted as the previous month has been linked to the current month. However, year over year change calculations should be interpreted with caution, particularly in the year following this implemented change.
TRENDS - JANUARY 2019
In Nova Scotia January 2019, year over year growth for the All-Items Consumer Price Index was 1.1 per cent, below the national average of 1.4 per cent. Monthly consumer prices were up 0.1 per cent in Nova Scotia and by the same amount, nationally.
Within Atlantic Canada, Nova Scotia and New Brunswick had the highest year over year consumer price inflation (+1.1%), followed by Prince Edward island (+0.4%) and Newfoundland and Labrador (+0.1%).
In January 2019, all provinces experienced positive year over year inflation, the highest in British Columbia (+2.4%).
Nova Scotia's consumer price inflation (year over year growth in CPI) excluding food and energy rose 1.6 per cent in January, below the national rate of 1.9 per cent. Price level gains for this index were largest in British Columbia (+2.5 per cent), and lowest in Newfoundland and Labrador (+0.3 per cent). On a monthly basis, Nova Scotia's index excluding food and energy was down 0.3 per cent.
The main contributors to the monthly (January 2019 vs. December 2018) NS CPI movement:
Dairy Products (+5.0%)
Processed meat (+4.8%)
Recreational equipment and servcies (excluding RVs) (-3.9%)
Inter-City transportation (-15.3%)
The main contributors to the annual (January 2019 vs. January 2018) NS CPI movement:
Passenger vehicle insurance premiums (+9.0%)
Tuition Fees (+5.5%)
Traveller accommodation (-12.9%)
Gasoline (-14.0%)
The CPI for food in Nova Scotia increased 2.5 per cent year-over-year with a 1.8 per cent increase month-to-month. CPI growth in food (year over year) was up in all provinces this month. Ontario showed the highest year over year food price growth (+3.6%). Nationally, annual food prices increased 2.8 per cent.
The Nova Scotia energy index decreased by 4.8 per cent compared to a year ago. Energy price declined the most in Ontario (-10.4 per cent) on a year over year basis. BC's energy index declined only 0.4 per cent, year over year. Nationally, the index was down 6.9 per cent.
Year over year, the consumer price index for shelter increased by 2.2 per cent in Nova Scotia and 2.4 per cent in Canada.
Major Components for January 2019
The following table shows the price increases specific to Nova Scotia for the major components of the CPI this month:
Long Run Trends
The All-Items CPI year over year inflation rate for Nova Scotia was below Canada's in January 2019. Nova Scotia's annual inflation has remained below the Canadian average since mid-2014, with the exception of only a few months. While month to month movements in the indices can be different, over time they generally follow the same overall trend.
Annual inflation for the CPI excluding food and energy was lower for Nova Scotia (at 1.6 per cent) compared to Canada in January.
Bank of Canada's preferred measures of core inflation
Compared with January 2018, CPI-Trim and CPI-Common rose 1.9 per cent and CPI-median was up 1.8 per cent in Canada. All-items CPI excluding eight of the most volatile components as defined by the Bank of Canada and excluding the effect of changes in indirect taxes (formerly referred to as CPIX) rose 1.5 per cent year over year in January 2019.
Appendix Tables and Charts
Source: Statistics Canada data portal: Tables 18-10-0004-01 and 18-10-0256-01
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