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Canada's inflation rate surged in August

Last Updated Sep 15, 2021 at 6:58 am PDT

Signage mark the Statistics Canada offiices in Ottawa on July 21, 2010. Statistics Canada says the economy stalled in February ahead of the collapse in March due to the COVID-19 pandemic. THE CANADIAN PRESS/Sean Kilpatrick

OTTAWA —  The Consumer Price Index rose 4.1 per cent in August on a year-over-year basis, the fastest pace since March 2003, according to Statistics Canada.

On a seasonally adjusted monthly basis, the CPI rose 0.4 per cent in August compared to July.

Fuelling much of the rise was higher gasoline and housing prices compared with the same month one year ago. Statistics Canada also says homeowner replacement costs, which is related to the price of new homes, rose at an annual rate of 14.3 per cent in August.

The pace of housing prices was the fastest yearly increase since September 1987 and marked the fourth consecutive month of double-digit price growth.

Also driving up prices in August was rising prices for meat, which rose year-over-year by 6.9 per cent, the fastest pace since June 2020, which Statistics Canada says is in part because of growing demand from restaurants.

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The consumer price index has been on an upward swing since the start of the year, and since April has clocked in above the Bank of Canada’s target range of between one and three per-cent.

CIBC senior economist Royce Mendes says the Bank of Canada will likely continue to look past the current figures because pressures don’t yet look be sustainable.