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April 20, 2022ANALYSIS OF NOVA SCOTIA'S CONSUMER PRICE INDEX FOR MARCH 2022 TRENDS – March 2022
Nova Scotia’s All-Items Consumer Price Index (CPI) increased 6.8% year-over-year in March 2022, up from the 5.7% year-over-year increase in February. Nationally, consumer prices were up 6.7% from a year earlier. The national increase was the largest gain since January 1991.
Statistics Canada noted that the increases were broad based with rising prices in all eight major components. Price increases in March reflect sustained price pressures in Canadian housing markets, supply constraints and geopolitical conflict which has affected energy, commodity, and agriculture markets.
Gasoline prices in Canada increased 11.8% month-over-month in March due to supply uncertainty following Russia's invasion of Ukraine. Compared to a year earlier, gasoline prices were 39.8% higher in March 2022.
Prices for durable goods increased 7.3% in March compared to same month a year earlier, posting the largest increase since February 1982.
Consumers paid 8,7% more for food purchased from stores when compared to March 2021. This was the largest year-over-year increase since March 2009 and reflected higher input and transportation costs.
Impact of COVID-19 on the Consumer Price Index
In March 2022, no special treatments for goods and services due to the COVID-19 pandemic were required.
Inflation was highest in Prince Edward Island (+8.9%) while Saskatchewan (+5.7%) had the lowest. Compared to the previous month, all provinces had increases in the CPI index in March 2022 including Nova Scotia (+1.7%).
Nova Scotia’s consumer price inflation (year-over-year) excluding food and energy increased 3.2% in March 2022. Consumer prices excluding food and energy were up in all provinces led by Manitoba (5.3%). Newfoundland and Labrador had the smallest increase at 2.8%.
The CPI for food in Nova Scotia increased 7.7% year-over-year in March 2022. Nationally, food prices were also up 7.7% from a year earlier. All provinces recorded year-over-year increase in food prices led by New Brunswick (+8.7%). Manitoba had the lowest increase at 6.3%.
Compared to the previous month, food prices in Nova Scotia were up 0.9%, on par with the national average. All provinces recorded seasonally unadjusted month-over-month gains in food prices in March.
Year-over-year, shelter costs in Nova Scotia increased 6.7% in March 2022, just below the national average increase of 6.8%. Compared to March 2021, shelter prices were up in all provinces with the largest increase in Prince Edward Island (+15.0%) and the smallest increase in Saskatchewan (+4.0%).
Nova Scotia's consumer price inflation (year-over-year growth in CPI) for energy was 31.0% in March, above the national average of 27.8%. Prince Edward Island (+41.8%) posted the largest year-over-year increases while New Brunswick and British Columbia (both +24.5%) had the smallest change in the energy index. On a monthly basis, the seasonally unadjusted energy index was up in all provinces.
Nova Scotia's consumer price inflation (year-over-year growth in CPI) excluding energy was 4.1% in March compared to a national rate of 5.2%. Ontario and Manitoba (both +5.5%) posted the largest year-over-year gain while Saskatchewan (+3.6%) had the smallest change in the CPI excluding energy.
Major Components for March 2022
The following table shows the price increases specific to Nova Scotia for the major components of the CPI this month.
The main contributors to the monthly change (March 2022 vs March 2022) in Nova Scotia CPI were:
- Fuel oil and other fuels (+24.3%)
- Gasoline (+11.1%)
- Furniture (+8.5%)
- Homeowners' home and mortgage insurance (-2.7%)
- Telephone services (-2.1%)
- Fresh or frozen chicken (-5.9%)
The main contributors to the yearly change (March 2022 vs March 2021) in Nova Scotia CPI were:
- Gasoline (+36.5%)
- Fuel oil and other fuels (+59.6%)
- Purchase and leasing of passenger vehicles (+6.7%)
- Mortgage interest cost (downward contribution, percent change not available)
- Video and audio subscription services (-6.4%)
- Telephone services (-4.0%)
Long Run Trends
In March 2022, the all-items CPI year-over-year inflation rate for Nova Scotia was 6.8%, just above the national inflation rate of 6.7%. Month-to-month movements in the indices can be different, but over time they generally follow the same overall trend. Nova Scotia’s all-items CPI increase of 6.8% in March was the largest increase since March 2003 (+6.9%).
Nova Scotia’s CPI excluding food and energy increased 3.2%, higher than the 3.0% year-over-year increase reported the previous month. Canada CPI excluding food and energy rose 0.7 percentage points from 3.9% to 4.6%. The NS CPI excluding food and energy was previously above or near 3% in 2003.
Bank of Canada's preferred measures of core inflation
Compared to March 2021, CPI-Common increased 2.8%, CPI-Median increased 3.8% and CPI-Trim was up 4.7% 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 5.5% year-over-year. The change in the core inflation measures was up 0.1 percentage points for CPI-common, up 0.3 percentage points for both CPI-median and CPI-trim from the previous 12-month period.
Appendix Tables and Charts
Basket Update
With the June 2020 release the CPI basket of goods and services has been updated. The new basket weights are based on 2020 expenditure data, in which spending would reflect pre-pandemic patterns (Jan-Feb), an economy mostly in lockdown (March-June), and the emergence of new consumption patterns as economy re-opened (July-December). Statistics Canada notes that the "The data reflect shifts in spending due to the COVID-19 pandemic that will likely take some time to stabilize across goods and services, and geographic regions" and the June 2021 headline CPI for Canada would be the same if the previous basket weights (2017) were used. The weights for shelter (+2.86 percentage points), households operations, furnishings and equipment (+2.23 percentage points), and alcoholic beverages, tobacco products and recreational cannabis (+1.7 percentage points) are higher in the 2020 basket while transportation had the largest decline falling from a 19.72% share to 15.34% share. New products classes were added for shipping fees and local delivery fees (including restaurant and grocery delivery fees), digital subscriptions services to magazines, and video game consoles. Further information on the update can be found in An Analysis of the 2021 Consumer Price Index Basket Update, Based on 2020 Expenditures
Source: Statistics Canada. Table 18-10-0004-01 Consumer Price Index, monthly, not seasonally adjusted; Table 18-10-0256-01 Consumer Price Index (CPI) statistics, measures of core inflation and other related statistics - Bank of Canada definitions
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