Inflation sets fresh three-decade high at 6.8% in April

The cost of nearly everything at the grocery store continued to climb higher to help push the annual inflation rate to a fresh three-decade high in April and economists warn prices could continue to heat up.

Statistics Canada said Wednesday that its consumer price index for April rose 6.8 per cent compared with a year ago, up from a gain of 6.7 per cent for March. That’s the highest since January 1991, when the annual rate was 6.9 per cent.

“The key takeaway from April’s CPI release is that inflation is spreading much more broadly, and at clear risk of getting firmly entrenched,” Bank of Montreal chief economist Douglas Porter wrote in a brief report.

“Barring a deep dive in oil prices in coming weeks and months, we expect that the worst is yet to come on the headline readings, and that inflation north of six per cent will still be with us by the end of this year.”

James Orlando, a director at TD Bank, said he expects little reprieve going forward with the persistence of food inflation, a continuation of rent price increases, rising mortgage interest costs, and a jump in gasoline prices.

“Anyone who has filled up their tank over the last couple of weeks knows that an acceleration of prices will show up in next month’s CPI print,” he said.

Overall food costs in April rose 8.8 per cent compared with a year ago, while Canadians paid 9.7 per cent more for food at stores in April, the largest increase since September 1981.

Compared with a year ago, the cost of fresh fruit was up 10 per cent, fresh vegetables gained 8.2 per cent and meat rose 10.1 per cent.