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Is the Canadian inflation rate really back at 2.8% ? (self.canadapolitics)

submitted 2 years ago by kiwiheretic to c/canadapolitics

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As a foreigner who follows the Canadian news I saw on https://www.ctvnews.ca/business/economists-expect-rise-in-inflation-as-price-growth-fight-enters-new-phase-1.6517322 that the Canadian inflation rate is 2.8% which surprised me as in our country it is around 7%.

If so then how did Trudeau do it? How did he soak up all the money he printed during Covid?

Does that mean that housing and cost of living pressure has also been eased?

Would like to know your thoughts.

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[–] [email protected] 5 points 2 years ago

Canada systematically under-reports inflation similar to the way they do in the US. But it's been that way for decades and their methods haven't changed recently so far as I know, so changes in the reported rate are still meaningful.

But it's reported monthly at an annualized rate. When they say 2.8% annual inflation, that doesn't mean it hasn't been much higher than that over the past year. Only that in that one month it was measured at a rate that would hypothetically add up to 2.8% if it continued for a whole year. When things are changing rapidly, one month's number might be less meaningful than usual.