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Canadian Inflation Topped 5 Per Cent — Hitting a 30-Year High

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If you feel like everything — from groceries to gas — is more expensive lately, you’re not imagining it. According to Statistics Canada, Canadian inflation hit a 30-year high this year, with the January 2022 inflation rate surpassing 5 per cent for the first time since September 1991. 

In January 2022, the Consumer Price Index (CPI) —  which Statistics Canada says “represents changes in prices as experienced for Canadian consumers” — rose 5.1 per cent on a year-over-year basis, which is up from December 2021 (which had a 4.8 per cent gain). 

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Related: The 15 best money tips to set you up for success in 2022

What costs more in Canada in 2022?

Unfortunately, it appears that prices are on the rise for many goods and services in Canada, especially when it comes to essentials like food, gasoline and housing. According to the Statistics Canada findings, year-over-year prices rose in all major components in January 2022 — with the price of shelter adding the most to the all-items increase, growing 6.2 per cent.

See also: Food prices rise by 4 per cent — and these products were hardest hit.

Are prices rising faster than Canadian wages?

Another factor to consider when looking at rising inflation is whether or not wages are growing in turn. Unfortunately, according to wage data from Statistics Canada’s January 2022 Labour Force Survey, average hourly wages rose only 2.4 per cent on a year-over-year basis last month. When comparing this rise in wages to the 5.1 per cent rise in the CPI, it appears that prices are growing at a faster rate than wages — which likely means that more and more Canadians are feeling a financial pinch and experiencing less purchasing power. 

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