Surging fuel costs are being blamed for an increase in inflation for March. The ongoing Iran war is expected to continue to force costs upward. “We are still looking at a scenario that where the longer this goes on and the more damage that might occur, of irreparable damage, it could take us into, not just days or weeks or months, but in fact years,” says petroleum analyst, Dan McTeague. In the last month, Statistics Canada data shows a 21.2 per cent jump in gasoline prices, that’s the highest monthly increase ever recorded. Energy costs climbed 13.1 per cent, transportation and non-durable goods rose 4.2 per cent and 3.2 per cent respectively. Overall food inflation slowed to 4.4 per cent in March, down from 5.4 per cent in February. The exception is for fresh produce which was up almost eight per cent. “Groceries are very sensitive to increases in transportation costs and fresh fruit and vegetables is where that’s going to show up first because they are being transported on such a short timeline,” says D.T. Cochrane of the Canadian Labour Congress. There was some relief Monday. The suspension of the federal excise tax on fuel is now in effect, that dropped gas prices by 11.5 cents per litre in Nova Scotia. “This is probably as good as it gets, $1.67 you’re seeing in Nova Scotia, the $1.75 and P.E.I. and the $1.72 in New Brunswick,” McTeague says. “I think people should be really aware that prices are going to head up much higher and much longer for a very uncomfortable period which would go well beyond the federal governments, temporary short-term removal of the excise tax.” Consumers, however, would like to see the federal government go even further “People need more money in their pockets going forward and if it’s lower taxes or whatever that’s what’s required to fix the economy and get moving,” says Frank Sullivan. Statistics Canada says if gas was taken out of the formula, inflation would have come in at 2.2 per cent.
