Just in Case you Didn’t Believe Prices are Going Up

Most of us have been feeling the pinch over the past several months as the prices on just about everything except mortgages keeps going up. But for those of you who still don’t believe, Statistics Canada just released the Consumer Price Index (CPI) for August 2011. While there are some slight differences from the two months prior, July and June, the results when compared with August 2010 are somewhat staggering.
The CPI for August 2011 shows a total of a 3.1% increase from August 2010; this was the same increase the CPI saw in June 2011. In July the CPI rose, although a bit less significantly, by 2.7%. Statistics Canada says that higher prices on food and gas are to blame for the yearly increase as a whole. Bloomberg has also studied the reasons for the increase of the CPI between July and August 2001 and they point towards things such as home insurance, mortgage insurance, cars, electricity, jewelry, and the cost of both landline and mobile phone service increasing, as being to blame.
Although the price of natural gas went down in the month of August, fuel prices increased significantly with the cost of gasoline jumping up 22.8%. While this may seem like a huge leap, consider that it’s actually a slight decline from July when the CPI showed that gasoline numbers were up by 23.5%. In total, we spent more on fuel (a total increase of 13.4%) in August 2011 than we did one month before in July 2011 (when the increase was only 12.9%.) So where are we going when we spend all that extra money on gas? The report also shows it’s either to a restaurant or a grocery store, as the percentage increase of food has also gone up.
The CPI showed that consumers were spending 5% more in grocery stores and that when they went out to eat, they were spending 2.7% more in the restaurants they visited. And unfortunately, this isn’t a case where we can pat ourselves on the back and tell ourselves that at least we’re improving. Food prices in July were only up by 4.3%, while last month they were up slightly more than that at 4.4%.
So what’s the latest Statistics Report to tell consumers? Not much that we didn’t already know. Prices are going up, and we all have to tighten the purse strings a little more (and a little more often) because of it. And there’s probably also a mixture of good news and bad news on the horizon. While the prices of gases are known to heavily fluctuate, and will therefore probably go down at some point; the same can’t always be said for food, so that’s just an area where we all may have to learn to make more permanent adjustments.