Analysis

Consumer prices rose 2.5% in the 12 months to January, led by increases for food and energy. The January rise followed a 2.3% increase in December.

Food prices rose 4.2% on a year-over-year basis in January following a 4.4% increase in December. In January 2012, consumers paid 4.9% more for food purchased from stores and 2.8% more for food purchased from restaurants compared with January 2011.

The cost of energy advanced 6.5% in the 12 months to January, after rising 6.0% in December. Gasoline prices increased 6.8% in January. The electricity index rose 7.3%, with notable increases recorded in Alberta and Nova Scotia. Prices for fuel oil went up 17.1% while natural gas prices fell 0.7%.

Excluding food and energy, consumer prices increased 1.6% in the 12 months to January after rising 1.3% in December. The 0.3 percentage point difference was led by higher prices for the purchase of passenger vehicles.

12-month change: Prices up in seven of the eight major components

On a year-over-year basis, prices rose in seven of the eight major components in January, the exception being recreation, education and reading. Transportation and food continued to post the largest increases.

The cost of transportation went up 3.7% in the 12 months to January, after gaining 3.3% in December. In addition to gasoline, prices increased for passenger vehicle insurance premiums (+3.4%) and for the purchase of passenger vehicles (+1.4%). Prices for air transportation also went up.

Food prices rose 4.2% on a year-over-year basis in January led by increases for food purchased from stores. Consumers paid more for meat (+6.5%), bread (+9.9%), and fresh vegetables (+8.3%).

Shelter costs went up 2.1% in the 12 months to January. This followed a 1.8% increase posted in December. In addition to electricity and fuel oil, consumers also paid more in homeowners' replacement costs. Conversely, mortgage interest cost decreased 0.4% in January after falling 0.7% the month before.

On a year-over-year basis, prices for recreation, education and reading declined 0.1% in January as consumers paid less for video equipment and travel tours.

Provinces: Prices up in all provinces

Consumer prices rose in every province in the 12 months to January. New Brunswick posted the largest increase (+3.2%) while British Columbia recorded the smallest gain (+1.7%).

In Ontario, prices went up 2.4% in the 12 months to January, following a 2.0% increase the month before. Gasoline prices rose 6.6% on a year-over-year basis in January after advancing 6.9% in December. Ontario consumers also paid more in homeowners' replacement costs and passenger vehicle insurance premiums.

Prices in Quebec rose 2.8% on a year-over-year basis in January, after increasing 2.5% in December. Gasoline prices went up 11.4% following a 9.9% gain in December. Quebec consumers also paid more for food purchased from restaurants and fuel oil. In January, prices in Quebec were affected by a one percentage point increase in the provincial sales tax.

In Alberta, prices increased 2.9% in the 12 months to January, matching the rise in December. The province continued to experience notable price increases for electricity. Conversely, of all the provinces, Alberta posted the smallest year-over-year gain for gasoline in January (+0.4%). Passenger vehicle insurance premiums also went up.

Prices in British Columbia went up 1.7% in the 12 months to January, matching the gain in December. Prices for gasoline rose 4.3% on a year-over-year basis after increasing 5.9% the month before. Consumers in British Columbia also paid more for homeowners' home and mortgage insurance and electricity.

Seasonally adjusted monthly CPI increases

On a seasonally adjusted monthly basis, consumer prices increased 0.5% from December to January after decreasing 0.2% from November to December. The transportation index rose 1.3% in January following a 1.2% decline the month before.

The shelter index rose 0.2% after rising 0.4% in December. The indexes for food, household operations, furnishings and equipment, and alcoholic beverages and tobacco products also rose in January.

Non-seasonally adjusted monthly CPI advances

Consumer prices, before seasonal adjustment, went up 0.4% from December to January, after falling 0.6% from November to December. On a monthly basis, prices rose in six of the eight major components. Prices for health and personal care products posted no change while recreation, education and reading declined.

The cost of transportation rose 1.8% in January after declining 1.9% in December. On a monthly basis, gasoline prices went up 2.8% and prices for the purchase of passenger vehicles increased 1.8%.

Food prices advanced 0.7% from December to January after rising 0.1% the month before. Prices for food purchased from stores went up 0.9% in January as consumers paid more for non-alcoholic beverages (+5.5%) and meat (+1.3%). Food purchased from restaurants increased 0.4% on a monthly basis.

The recreation, education and reading index declined 1.4% in January as consumers paid less for travel tours and sporting and athletic equipment. The January decrease follows a 0.7% decline in December.

At the provincial level in January, prices rose in every province. Nova Scotia and Quebec posted the largest monthly increases (+0.8%) while Prince Edward Island and Ontario recorded the smallest gains (+0.2%).

Bank of Canada's core index

The Bank of Canada's core index rose 2.1% in the 12 months to January, after increasing 1.9% in December. Notable increases were recorded for electricity, food purchased from restaurants and homeowners' replacement costs.

On a month-over-month basis and before seasonal adjustment, the core index increased 0.2% in January following a 0.5% decline in December.

The seasonally adjusted monthly core index rose 0.3% in January after falling 0.1% in December.