Canada’s inflation rate fell to an annualized –0.2 per cent in April, as the COVID-19 pandemic pushed down consumer prices to their lowest level in more than a decade.
Statistics Canada’s consumer price index plummeted to negative reading as the price of just about everything got much cheaper last month than it was a year ago. April’s decline was the first time Canada’s year-over-year inflation rate fell into negative territory since September 2009.
Among the major categories seeing huge price declines were:
- Gasoline, down by almost 40 per cent.
- Traveler accommodation, down by almost 10 per cent.
- Electricity prices, down by more than four per cent.
- Clothing and footwear, down by almost six per cent.
Food prices were among the few products that got more expensive during the month, rising by 3.4 per cent overall due to “higher demand for non-perishable food products, as consumers were encouraged to limit grocery shopping trips as a result of physical distancing measures,” the data agency said.
The well-documented surge in demand for toilet paper helped push prices in that product category up six per cent, the biggest spike on record.
The price of clothing came down, mainly because just about all clothing stores were forcibly shut down during the month, which made inventory pile up and forced any retailers with the capacity to sell online to do so, often at deep discounts. The clothing and footwear category fell by 5.9 per cent from March to April, the deepest plunge on record.
The data agency noted that much of the decline in electricity prices came from the Ontario government’s decision to scrap time-based pricing during the month and bill people at the lowest possible rate, regardless of when they are using power