Indian envoy warns of 'big red line,' days after charges laid in Nijjar case
India's envoy to Canada insists relations between the two countries are positive overall, despite what he describes as 'a lot of noise.'
Economists are predicting Canada's inflation rate may have peaked in June as soaring gas prices pushed the cost of living up 8.1 per cent compared with a year ago, its hottest pace in nearly 40 years.
Statistics Canada said Wednesday the annual inflation rate for June was up from 7.7 per cent in May and marked the largest yearly change since January 1983 when it hit 8.2 per cent.
The increase in the consumer price index for the month was largely due to higher gasoline prices, which shot up by more than 50 per cent compared with a year ago.
Excluding gasoline, the country's inflation rate was 6.5 per cent in June compared with 6.3 per cent in May.
CIBC senior economist Karyne Charbonneau said the headline reading for inflation was lower than expected and called it the "first negative surprise on inflation in many months."
"With gasoline prices expected to fall next month, we could finally have seen peak inflation," Charbonneau said in an email.
According to retail analytics platform Kalibrate, gas prices have dropped from a peak of $2.14 per litre in mid-June to $1.88.
Douglas Porter, chief economist at the Bank of Montreal, said the June inflation reading was "better, but not good."
"There is likely to be some relief in next month's report, as gasoline prices are currently tracking roughly a nine per cent drop in July," he said in a report. "However, the concern is that other costs remain robust."
"While a pullback in pump prices could calm headline inflation next month, we will need to see core relent for inflation to truly peak."
RSM Canada economist Tu Nguyen said she thinks it's premature still to declare that Canada has reached the peak of inflation.
Nguyen said there are still many uncertainties when it comes to global pressures on inflation, including the war in Ukraine and an ongoing pandemic that could shut down manufacturing overseas in places like China.
In its latest monetary policy report, the Bank of Canada forecasted inflation will hover around eight per cent over the next few months before it begins to decline.
Last week, the Bank of Canada ratcheted its efforts against rising inflation when it raised its key interest rate by a full percentage point, bringing it to 2.5 per cent. It was the largest single increase since 1998.
Statistics Canada is scheduled to release its inflation report for July on Aug. 16 ahead of the Bank of Canada's next rate decision set for Sept. 7.
CIBC said the Bank of Canada will then be deciding between a half of a percentage point hike or a three quarters of a percentage point hike and will likely lean towards the latter. But, Charbonneau said the June inflation reading "may increase the chance they choose the small of the two steps."
Porter also predicted the Bank of Canada will hike its key interest rate by a half of a percentage point in its next decision.
However, Nguyen said she still expects the central bank to opt for another supersized rate hike in September.
"I think that we should expect another large rate hike in September, either 75 basis point or even as much as 100 points," she said. "And the reason for that is ... there's no question that prices are still rising up very, very quickly."
In addition to high food and gas prices, Canadians experienced a surge in prices for travel-related services as public health restrictions eased and travel increased. Prices for accommodation rose by about 50 per cent across the country compared with a year ago.
"The return of sporting events, festivals and other large in-person gatherings has resulted in higher demand for accommodation, particularly in major urban centres," Statistics Canada said.
On a month-over-month basis, the consumer price index edged higher by 0.7 per cent, largely due to rising prices for gasoline and travel accommodations.
After declining slightly in May, air transportation costs rose 6.4 per cent month-over-month.
Canadians also continued to see higher food prices, with the cost of food up 8.8 per cent compared with June last year.
Among food items, the largest increase in prices was for edible fats and oils, which rose by 28.8 per cent year-over-year.
Here's what happened in the provinces (previous month in brackets):
The agency also released rates for major cities, but cautioned that figures may have fluctuated widely because they are based on small statistical samples (previous month in brackets):
This report by The Canadian Press was first published July 20, 2022
India's envoy to Canada insists relations between the two countries are positive overall, despite what he describes as 'a lot of noise.'
With Donald Trump sitting just feet away, Stormy Daniels testified Tuesday at the former president's hush money trial about a sexual encounter the porn actor says they had in 2006 that resulted in her being paid to keep silent during the presidential race 10 years later.
The U.S. paused a shipment of bombs to Israel last week over concerns that Israel was approaching a decision on launching a full-scale assault on the southern Gaza city of Rafah against the wishes of the U.S.
Footage from dozens of security cameras in the area of Drake’s Bridle Path mansion could be the key to identifying the suspect responsible for shooting and seriously injuring a security guard outside the rapper’s sprawling home early Tuesday morning, a former Toronto homicide detective says.
A chicken farmer near Mattawa made an 'eggstraordinary' find Friday morning when she discovered one of her hens laid an egg close to three times the size of an average large chicken egg.
Susan Buckner, best known for playing peppy Rydell High School cheerleader Patty Simcox in the 1978 classic movie musical 'Grease,' has died. She was 72.
Accused killer Jeremy Skibicki could have a challenging time convincing a judge that he is not criminally responsible for the deaths of four Indigenous women, a legal analyst says.
A Calgary bylaw requiring businesses to charge a minimum bag fee and only provide single-use items when requested has officially been tossed.
Two Nova Scotia men are dead after a boat they were travelling in sank in the Annapolis River in Granville Centre, N.S., on Monday.
An Ontario man says he paid more than $7,700 for a luxury villa he found on a popular travel website -- but the listing was fake.
Whether passionate about Poirot or hungry for Holmes, Winnipeg mystery obsessives have had a local haunt for over 30 years in which to search out their latest page-turners.
Eighty-two-year-old Susan Neufeldt and 90-year-old Ulrich Richter are no spring chickens, but their love blossomed over the weekend with their wedding at Pine View Manor just outside of Rosthern.
Alberta Ballet's double-bill production of 'Der Wolf' and 'The Rite of Spring' marks not only its final show of the season, but the last production for twin sisters Alexandra and Jennifer Gibson.
A mother goose and her goslings caused a bit of a traffic jam on a busy stretch of the Trans-Canada Highway near Vancouver Saturday.
A British Columbia mayor has been censured by city council – stripping him of his travel and lobbying budgets and removing him from city committees – for allegedly distributing a book that questions the history of Indigenous residential schools in Canada.
Three men in Quebec from the same family have fathered more than 600 children.
A group of SaskPower workers recently received special recognition at the legislature – for their efforts in repairing one of Saskatchewan's largest power plants after it was knocked offline for months following a serious flood last summer.
A police officer on Montreal's South Shore anonymously donated a kidney that wound up drastically changing the life of a schoolteacher living on dialysis.