Alberta gas tax pause helps, but latest inflation stats still 'worrisome': Economist
New data shows record-high inflation across the country but in Alberta, huge increases were at least somewhat softened by new provincial government policy.
Statistics Canada said Wednesday that its national 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.
In Alberta, the rate declined from March to April, from 6.5 to 6.3 per cent.
Economists believe it's a change largely spurred on by a provincial gas tax holiday.
"Gasoline, instead of adding on to accelerating inflation, actually subtracted a little bit from those inflation rates," said University of Calgary economist Trevor Tombe.
"I think (the gas tax pause) lowered inflation by about 0.4 points."
In April, Premier Jason Kenney announced a temporary stop to the collection of that levy. It's estimated to save Albertan drivers about 13 cents for every litre of gas they buy.
Fuel prices in the province are still high, sitting around a year-over-year increase of 26 per cent.
And there are other things still drastically impacting inflation -- and pocket books -- this year.
Food costs in the province were up by 7.7 per cent in April, compared to 6.8 per cent in March.
"Food is an increasingly important contributor to inflation," Tombe said. "It is almost now as important a driver of a high inflation as gasoline is."
Meat, bread, pasta and fruit costs spurred much of the increase.
Supply chain bottlenecks, shortages and passed-down farming costs are partially to blame. Russia's invasion has also put upward price pressure on food products that use wheat, Statistics Canada said, while poor weather in growing regions has also impacted prices.
Real estate and cost of accommodation were further inflation drivers in Alberta. Part of the latter can be chalked up to energy and increasing natural gas prices.
But the increasing cost of energy also helps the province. Tombe is convinced it'll lead to a large surplus, which can sometimes trickle down to consumers.
"It is indeed difficult to see directly what implications government surplus has for your household's bottom line, but when government revenue -- especially in Alberta from oil and gas royalties -- is high, taxes in the future are going to be lower than they otherwise would be," Tombe said.
"So there is some trade-off there between how much weight you put on the short-term cost versus the longer-term benefits that we accrue fiscally through the government."
The opposition New Democrats believe the main takeaway from the Statistics Canada data involves living wages.
An NDP release points to inflation rising 4.5 per cent more than the increase in wages in Alberta on a year-over-year basis. That's compared to 3.5 per cent nationally.
Elsewhere nationally, there was very little good news for consumers. The federal rate of inflation was the highest since January 1991. The annual rate then was 6.9 per cent.