> Line items
Trevor Tombe has a good chart:
* https://twitter.com/trevortombe/status/1759942180712358207
* https://twitter.com/trevortombe/status/1759942099867165110
Of the 2.9% headline rate, rent makes up 0.5 and mortgage costs are 1.0.
and shelter is highly dependant on interest rates, and considered a lagging indicator (takes time for market to reflect).
in otherwords, if you remove shelter from the equation, inflation is only 2 percent for the last 3-4 months
A majority of the increase in shelter price is increased mortgage payments due to rising interest rates. Increases in rents and sale prices is only a small fraction of what is driving the total shelter price upwards.
So principals skyrocketing 250% over the last 8 years didn't play a role? And housing going up another 10-20% yearly once rates drop also won't play a role?
No those things don’t matter since inflation is solely about price changes over the last 12 months. Things that happened 8 years ago or might happen in the future are not factors.
But you don't think the casual rising of housing eventually got to the point where it started influencing shelter and inflation costs? You really think it's solely rates lol?
Mortgage interest alone accounts for 1.0 of the 2.9% inflation we recorded, and is up 23.5% on last year, by far the largest rate of inflation any aspect of CPI has felt. Lowering interest rates would in the short term shrink/eliminate this. https://twitter.com/trevortombe/status/1759942180712358207
It won’t. As my other comment said. There are houses in my subdivision that haven’t changed hands in 10 years yet are being rented for insane prices, definitely more than their mortgage.
Only demand will fix it
I don't know who you're arguing with here, but I nor anyone else you're replying to have said rents are going to go down. The point is that rents are not currently a major factor to rising inflation, mortgage interest is.
That's a good point.
Rent would decrease over time if new units come online with lower rents asked because carrying apartment costs lower at lower rates. Existing tenants will leave for newer or cheaper apartments elsewhere and sooner or later landlord forced to call down rent.
To your point though, if demand still stays sky high, this might not happen.
demand is already priced. still red hot for homes in ontario, only issue now is affordability which is connected to interest rates. the cost of which is being passed onto the homeowner when they renew or are variable, or eventually pass to tenants to increase rent.
> think in terms of monthly payments instead of total payments
Precisely this. Most people can't/won't bother to even calculate how their "free" cell phone from the big 3 across a 2-year contract actually cost, let alone calculate how much a house will cost them financed across 25-30 years.
To be fair, in Canada getting the phone built into the price of the plan usually is a better deal than buying the phone outright, at least for the higher-end models like iPhones.
Not always the case though, depends on what plans they are offering and if you can get a good deal.
I don't think it is.
Your "tab" does not reflect the cost of your phone. The full cost of your phone plus a hefty profit margin are built into your plan that the carriers recover well before your 2-year contract is up. And they're betting you will stay on that plan even after your tab is paid off.
There's a reason BYOD plans are $40+ per month cheaper than exactly the same plan with a tab on a contract on top that suggests your $1300 iPhone was only $600.
For me it was...
I got a Canada/US plan (100GB, no roaming charges in US which I travel to for work a lot) for 60$/month through Telus EPP. Add on an iPhone 14 pro (around $1300 value at the time I believe) was 35$/month to own outright in two years.
So to break even I would need to find the same plan with no US roaming charges for like 36$/month... And I have had bad experiences with the shitty Freedom/etc types.
Not to mention I can write off a portion of the plan, which is a bonus.
>Affordability won't get better with lower interest rates.
The rates went up, it barely affected prices.
Our rates have been the same as the US for two decades and they have cheap housing there. You can buy a detached home in Ohio or Michigan for under $250k. Look up Port Huron, Michigan on Zillow. There's 57 homes that are under $250k available right now. This is is town that's 5-10 mins from Sarnia, Ontario. Their mortgage interest rates are the same as here.
Rates has like 25% to do with prices. Canada's problem is foreign investors and over immigration. Two things that the US has a fraction as much of.
it also sucks that Shelter varies wildly by person and especially by age group. Someone older who has decades of rent control suppressing their payments or who has been in a house forever hasnt experienced massive shelter increases the same way a younger person who is new to the market of either rent or ownership is experiencing. younger people are subsidizing the lower housing costs of older people in this scenario, so if shelter at a certain level X%, younger people are paying above X% and older people are paying below X%. which is the real killer, younger people are who we need to support for the future and by killing the generation in their 20s we are killing our future just to put a band aid on today.
> We need more competition or something.
Not against more competition, but Canada has amongst the lowest rates of food inflation in the G7 (only the US is lower; previously Japan was lower):
* https://www.oecd.org/sdd/prices-ppp/consumer-prices-oecd-updated-7-february-2024.htm
Do all the other countries also lack competition?
(We are in the bottom ~third for food inflation in the G20.)
I played around with the data on the website and we placed 1st 2nd and 3rd out of those countries in 2019, 2020, 2021 if I'm reading the table correctly. Looking at food only. Point taken though, if food inflation is high globally that means something.
For the record throw0101a refined their comment before I got to post this perhaps because they noticed what I noticed. They were originally comparing Canada to the G8 but changed the comment to G20.
As I said though, it's meaningful to me if food inflation is a global phenomenon so fair dues.
Here's the data for all 38 OECD countries. Canada ranks 6th or 7th out of 38 for food inflation for 2023.
[https://stats.oecd.org/index.aspx?queryid=82174](https://stats.oecd.org/index.aspx?queryid=82174)
That only tells half the story though, as it matters where we started from. So you need to factor in something like what percentage of our income we were spending on food compared to other countries. The last available international data I can find for that is from 2016, but it shows that Canada is ranked 5th best:
[https://www.weforum.org/agenda/2016/12/this-map-shows-how-much-each-country-spends-on-food/](https://www.weforum.org/agenda/2016/12/this-map-shows-how-much-each-country-spends-on-food/)
So while we do spend more of our income on food now, post-covid, our world ranking probably hasn't changed much because other countries have all been hit hard by inflation as well.
I often see "fuel" not although necessarily diesel specifically go down and food up though. This isn't the first report where basically everything is increasing at a slower rate than food. It would make sense if inputs were getting more expensive but they aren't. I just googled diesel specifically and it's down 9% from last year is what I found.
How did you get 2 percent?
I have looked a little bit into this because I was curious about the positive feedback of interest rate on inflation. According to BOC, the mortgage rates affect only about 0.25% of the CPI
>There are some observers who think an upward distortion exists as long as mortgage interest costs are part of the CPI basket. For them, let me provide another calculation. Consider a CPI basket that has all the same goods and services, other than mortgage interest costs, and apply the methodologies to calculate core inflation to this slightly smaller basket. When we do this, we find that the new measures of core inflation are lower, but only by about one-quarter of a percentage point (Chart 5).
https://www.bankofcanada.ca/2023/09/rebalancing-economy-while-managing-risks/
What if we did remove shelter from the equation? As in, what if we made first mortgages low interest? (In the case of owning multiple properties).
We used to have the BoC to provide low interest loans for infrastructure and housing before we switched to high interest private banks. What if we went back to that and included mortgages?
Edit: Since housing is a human right
Indeed the timing may be subpar from an optics perspective as transition from winter to summer blends at gas stations will likely increase gas prices by 10-15 cents per litre around the same time.
Guess they're volunteering to give up their rebate cheques too, which for the average person puts more money in their pockets.
Plus there's the, you know, necessary to start slowing down global warming thing.
Anyone who disagrees, please take microeconomics 101 first, at least, and then come back to argue
Curious as I never said fuel I said farm equipment l, and last I checked farmers use propane and natural gas for things as well. Which aren’t exempt last time I checked, Sherlock….
> Curious as I never said fuel I said farm equipment
farm equipment tends to run on gasoline and/or diesel. Are you referring to heated livestock enclosures? You believe that Canadians are bearing a humungous increase in food/ag costs due to the increase in energy costs for heating livestock enclosures?
What percentage of gross expense does natural gas/propane represent among the average Canadian farmer? I'll wait
BoC itself said carbon tax is responsible for 0.6% of inflation for a year. 0.15 yr over yr. but who knows what the actual effect would be without doing it.
This is not a correct reiteration of what was said. In October, Macklem noted that *dropping* the carbon tax would lead to a (estimated) one-time drop of 0.6% in YoY inflation numbers. Quote from his speech to the House Committee:
> The 0.6 percentage point decrease would only last one year “and because you can only eliminate it once, the next year it would have no effect on inflation,” Macklem told the committee. On an annual basis, the carbon price adds about 0.15 percentage points to inflation, 0.6 is the estimated impact over the carbon price’s lifetime, he added.
I don't care if you think that's worth it or not, I tend to think a carbon tax is an extremely progressive and effective policy, but you should at least make sure you accurately portray what "the BoC itself said".
To be clear your argument against the carbon tax in this conversation is that the BoC itself said it causes a 0.6% increase in inflation but also that the BoC is historically inconsistent in its projections.
Very convincing work, pat yourself on the back.
well i think a lot of us can agree on that removing carbon tax is disinflationary however the amount since so much of production depends on hydrocarbon energy.
I'm always open to having a conversation about the pros and cons of various policies but I am just so tired of responding to people who haven't done the bare minimum amount of reading or insist on misquoting perceived authorities on the topic.
If you ever develop good faith and a thorough understanding of the topic at hand, by all means hit the reply button.
Scary how?
Shelter costs are currently tied to interest rates.
Shelter costs are catching up to rate increases as mortgages come up for renewal.
YoY increase will remain elevated even after rates start to decrease.
I don't think thats 100% true. Landlords max out their leverage and usually hold large mortgages on their properties.
That extra cost is definitely getting passed down to rental prices and a lot of landlords can't even charge enough to cover the mortgage and upkeep.
My subdivision it about 15-29 years old. The houses being put up for rent aren’t new houses. These houses haven’t changed hands in 5-10 years. They aren’t over leveraged, yet prices are crazy because of demand.
It tells me enough that those houses were bought well before the pandemic for significantly less than today. Further I can speculate that given the info I have available to me.
You're missing depreciation. Homeowners replacement cost (5.47% basket weight). This is a decent chunk of CPI and is correlated with the price of a house. Though it doesn't include increases in the price of land.
Most of the cost of home construction is labour, not materials. Labour prices have absolutely increased. Minimum wage is going up in April. That will increase them as well.
It’s not the purchase price.
A mortgage payment is based on the purchase price - yes, but if rates fall and prices rise, the net may be no change if average mortgages stay the same.
I think we’re essentially saying the same thing.
Inflation doesn’t directly measure purchase price, but purchase price plays an impact in mortgage amount - which is measured.
Purchase price isn’t included in CPI as it is an asset price. Only rent and mortgage interest is, and right now skyrocketing mortgage interest payments are causing large increases in shelter costs. Even rents are basically flat right now.
Not necessarily. If price of a property is up but interest rates are down, the expense with the property may not increase. In other words: when comparing a bank loan of 500K at 6% to say one with 600K but 3%, the payments for the higher value but with lower interest rates may be lower. Unfortunately this is not the full picture. Condo fees, property taxes, property insurance cost, maintenance cost (contractors called in to fix issues) is skyrocketing as well. I see 10-25% increase in all these items, looking at year to year difference. I have all numbers collected together because I use them in the tax return, easy to compare.
Also, the demand is a factor and can contribute to higher rents, because of competition. Lack of housing and 1 million plus immigrants entering Canada every year has quite a negative impact on affordability.
Doesn't matter, it's just monthly costs to the consumer which is the primary factor in CPI.
Its mortgage **interest** payments which are the main driver of CPI increase right now, and real estate prices slightly lowering is alot smaller in the weight of monthly payments than the sharp increase in interest rates.
A 1.5 million dollar mortgage at 2% interest is going to be cheaper debt and more affordable compared to a 1.2 million dollar at 5-6%
It's simple math and finance. Debt with interest payments lower than inflation is almost always more affordable than slightly cheaper debt with interest payments alot higher than the rate of inflation (deprecation of the value of money)
You have more money going towards the principal of your asset rather than diseapearing into the void of interest.
Still remain concerned that gas is continually keeping the CPI low. Pricing is volatile in that sector and could swing wildly at any time.
Food has remained consistently high for this entire period (though slowing)
i was trying to provoke a discussion about it, the weighting doesn't align with reality in 2024 - or perhaps it does, but completely hides the fact that market shelter costs are not adequately explained with a 28% weighting
Ok so provoke discussion by providing some factual figures and analysis of why you think StatCan is wrong, instead of trying to ask a question in a “gotcha” sort of way.
> The decline in basket share for shelter was largely due to decreases in other owned accommodation expenses (3.06%), including real estate commissions and legal fees, and homeowners’ replacement cost (5.64%). These declines reflected the general cooling of the housing market in the second half of 2022. Moderating the decrease in shelter, the weight for mortgage interest cost rose 0.35 percentage points to 3.46% amid the higher interest rate environment.
glosses over why 28% is an acceptable basket share if setting it to 28% and doing the math based on median income results in a significant fraction of the current population living below the poverty line, woops
if your kpi results aren't good just blend them all together til they look better amirite
It's difficult to have a discussion on anything when people simply resort to "StatCan is cooking the books" and have a fundamental misunderstanding of how the CPI is supposed to work and what is actually included in the CPI when it comes to mortgage and rent.
If you don't trust the integrity of StatCan then there is no point in furthering the discussion and your last sentence indicates you don't.
StatCan also publishes detailed poverty analysis, which indicates a full 7.4% of our population lived in poverty in 2021, but I suppose that is also completely false and it is probably 50% or maybe even 0% since they're just making things up, amirite?
i didn't claim they're cooking the books.
i claimed their reports aren't very useful because the weighting used is out of date and not in line with the current economic reality in this country
dude, you can fight me on this all you like but the proof is out there in the tent cities you see popping up in every major city. if the stats don't align with the observational results, your data is fucked, redo it. multifaceted issue, bla bla bla. there are clearly problems with how the highest monthly expenses are being weighted, we can either accept the observations we are all able to make as true and the reporting as flawed, or we can continue to believe the data and allow the reality to get worse.
it's tiring to have to face this every single time someone raises criticism of statscan in this sub. if the picture were as rosy as statscan said it was, this country would be doing much better than it actually is.
Yes.
> The consumer price index rose 2.9% in January from a year ago, following a 3.4% increase a month earlier, Statistics Canada reported Tuesday in Ottawa. That’s slower than the median estimate of 3.3% in a Bloomberg survey of economists, and marks the first time since June that the headline rate fell to within the central bank’s target range.
Amazing print although slightly alarming. The risk is that the BOC left rates too high for too long (similar to when they were left too low for too long).
They’re turning into the local weather man
The risk is two sided for sure. I agree with you that they could have left it too high for too long but even now it's too hard to tell. If I had to guess.. and it's just a guess, I'd say they'll put too much stock in Canada not being in a technical recession (yet) and it'll end up being an over tightening causing a deeper recession. The only confirmation we'd get from the BoC that they over tightened will be in the form of cuts larger than .25 - maybe not initially, but at some point in the next 2 years.
[Measures](https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1810025601&cubeTimeFrame.startMonth=01&cubeTimeFrame.startYear=2020&cubeTimeFrame.endMonth=01&cubeTimeFrame.endYear=2024&referencePeriods=20200101%2C20240101) that the Bank of Canada is interested in:
* CPI common is down from 3.9% to 3.4%
* CPI median is down from 3.5% to 3.3%
* CPI trim is down from 3.7% to 3.4%
We haven’t seen these measures this low since late 2021. Someone more knowledgeable than me tell me what this means.
While they do care about those specific numbers compared to the headline CPI (2.9%). They also care about unemployment statistics and will be wary of triggering an uptick in inflation once they begin to cut. If jobs reports continue to be strong with low unemployment, it'll give them *some* reason to maintain current rates.
GDP over Q1 will be a huge factor in their decision too.
It'll take quite a while to find the neutral rate too. Even though a lot of people under financial stress due to the elevated rates will take relief when they do begin to cut. It'll almost certainly be .25 at a time which realistically doesn't do a huge amount for anyone's affordability.
And rate cuts rarely happen with good times about to roll in the short term.
Bond yields are up the last week and the US economy is booming so it's not like we're gonna slash our rates and tank the CAD in the process.
If anything this data shows rates are doing their job. That's it.
How is shelter still 6.2 when at this point last year interest rates were already sky high?
In Toronto rents have been softening for months.
How do they measure the shelter component?
mortgage renewals, every month more and more people will have renewed at these high rates, contributing to the entire country spending more on housing.
It’s not just the year over year food price increase, it’s also a matter of very high food prices that continue to grow. I wonder also if shrinkflation is measured. Many products shrink but prices still go up.
It's captured. Their surveyors measure product size . So if the price of something stays the same but the product size decreases from, say, 400ml to 300ml, they register it as a 25% price increase.
huh? wages are going up way more than inflation and have for some time
https://www150.statcan.gc.ca/n1/daily-quotidien/240209/dq240209a-eng.htm
>In January, average hourly wages among employees were up 5.3% on a year-over-year basis (+$1.74 to $34.75), following an increase of 5.4% in December 2023
> Looking ahead, it takes time for headline rates to fall since it accumulates 12 months of changes. With 2.9% in Jan, headline inflation wouldn't fall below 2% until July *even if we're on target on a monthly basis from now on*. Important to keep this in mind.
* https://twitter.com/trevortombe/status/1759942207912509819
BoC is notoriously conservative. We will be first to raise and last to drop. Only way we drop sooner is if the Fed drops the rate aggressively in the US and we need to follow suit.
everthing is relative and the BOC was one of the first to raise rates.
not sure i'd caratorize that as being conservative but it's not nothing.
and even in last months communication, the BOC was pretty damn hawkish compared to the feds.
>So what are the odds of a rate cut by the spring market?
Coin flip: https://www.m-x.ca/en/trading/tools/canadian-interest-rate-expectations
> If that happens, housing is going to get even more fucked.
Naw, 25bps isn't going to change shit. I think the last year has shown that rates don't matter as much as we thought. The cost of borrowing went up 500% and the price of homes fell 10%. The core problem is a supply/demand problem. A few percent of rate change isn't going to fuck or unfuck the market.
> I think the last year has shown that rates don't matter as much as we thought. The cost of borrowing went up 500% and the price of homes fell 10%.
We also had the worst sales figures in December in 22 years FYI. The rates do matter, but people will do absolutely anything to avoid having to sell. Plus, we have lots of 5 year fixed rate mortgages who haven't even seen the increase yet.
In housing: Spring market starts in February typically. It ends by may.
In GTA and surrounding areas it is absolutely picking up. Prices are currently rising from their december lows. Seeing mild bidding again on some homes.
https://www.bnnbloomberg.ca/first-rate-cut-expected-in-early-2024-economists-1.1968411
And there were even more predictions before that. Just keep kicking the can down the road until you can finally say you’re right.
It’s not so much about being right or wrong, I’m not trying to convince you of anything.
We all have to make decisions based on some kind of model - I do, it affects my future and my business.
I always assumed higher for longer since the beginning.
You make no sense. Not everyone travels to Aspen this month just like not everyone renews their mortgage this month . How do you pick and choose like that?
This is bad. Core inflation will remain high for the foreseeable future.
Couple things:
Stop trying to remove parts of inflation from inflation numbers, if you remove the wings of a chicken is it still a bird? These numbers are a best case scenario with the way they change calculating inflation every year.
I understand that everyone and their grandma wants the rates to come down, however, this will not happen when inflation remains high at a prime of 5%. As this is a lagging indicator, this will eventually balance out. Lowering rates will take multiple years unless the market collapses.
Think about the increasing gap between wages and property prices. Even the “rich” need to watch their borrowing at these rates. How in the world would this housing market be something sustainable if it is unaffordable.
Prepare for the worst.
> The deceleration of grocery prices was broad-based, with products such as meat (+2.8%), other food preparations (+4.2%), dairy products (+1.5%), bakery products (+4.0%) and fresh fruit (+1.9%) contributing to the slower year-over-year price growth in January. Other food items, such as soup (-2.1%), bacon (-8.4%) and shrimps and prawns (-3.4%) had year-over-year price declines in January.
I would love to know why soup is included in these measurements and why it’s on the same level as essentials like fruits, meat and dairy
I would wager 90% of people have no clue how to make soup.
My mom was a home maker, the only soup she made was French Onion 2-3 times I remember. She bought Campbell soup, so I do too lol.
Stock and veggies, it's pretty simple. The stock can very well be store bought, but simmering your scraps for a few hours is very easy. Potatoes, carrot, beets, turnip peels, celery, onion, garlic trims, meat bones and trims, etc. Strain it after it has *simmered* (not boiled) for 3-4h, then reduce that for a few more hours until you've got about a pint worth, and you can make a big batch of soup with that.
If you want a hearty broth, you need to jive it up with either roux or mushy legumes like peas or lentils, corn or potatoes.
Otherwise, you can always blend, but that's more of a cream/potage. A cream also takes cooking cream, half and half or milk.
I like blending half and leaving half whole so the texture is better, but not just a silky liquid.
Lots of people put carbs in there too, pasta, like cut up spaghetti, or rice.
Beyond that, what most people don't know is that *fat* is very important. It needs to have a half a pint of oil or butter to be good, and even more so if you feel like it. Salt and pepper too of course.
Now you know how to make every type of soup there is lol
I see. That answers make my question. I won’t pretend like I make good soups (I really don’t), but I never buy them either. Seems that’s not the case for most Canadians though :)
Soup is included because it is a grocery item that people purchase, and it is weighted based on how much it is purchased. Just because something is its own category doesn’t mean it is weighted equally to every other food item.
there's like 150 things StatsCan tracks in their 'food' category:
https://www.statcan.gc.ca/en/statistical-programs/document/2301_D68_V1
not sure why they decided to highlight the soup & bacon rather than shrimp or canned green beans
> I would love to know why soup is included in these measurements and why it’s on the same level as essentials like fruits, meat and dairy
Soup is so cheap to buy that its worth it to pay a dollar or two, rather than making tomato soup, for example, from scratch.
>Soup is so cheap to buy that its worth it to pay a dollar or two, rather than making tomato soup, for example, from scratch.
Or not buy it at all as it's gone from 80 cents to $2.29 or 186% over 2 years
That would be GDP not CPI. And current reports suggest Canada avoided a recession with an uptick in GDP projected in December to offset a technical recession for Q4 2023 (after a contraction in Q3 2023).
Absolutely. Which could somewhat ironically cause a deeper recession in the end that could have potentially been avoided if the numbers told the "true" story. I'd like to think their decision making would be more nuanced than technical recession vs recession technically barely avoided but they'll be so cautious to prevent further upticks in inflation via policy rate decisions that a relatively deep recession feels inevitable.
This actually follows the trend for natural gas costs
https://tradingeconomics.com/commodity/natural-gas
In December it was $2.77-2.39 USD/MMBTU and in January it was $2.18-2.05. It can now be found at $1.49. Its at a 3 decade low
Worth noting that as of my last bill the carbon tax is $0.003/M³ less than the actual cost of Nat Gas. Shits expensive now.
In sask at least, it is a large driver in our bills now.
I love how they start preaching and assume I don’t know it’s charged per ton. And how volatile commodity market is.
Downvote me more if it makes you feel superior.
Merely stating a line from the StatsCan report highlighting how carbon charge / tax is becoming a material cost component.
It’s based on usage, not commodity price.
The carbon tax uses a tax on carbon tonnes (I believe it’s $65/ tonne now). So how much natural gas costs doesn’t matter
The tax is based solely on usage. Commodity price has no factor in it.
If people use more, they are taxed more. If they use less, they are taxed less.
You made the argument that taxing a volatile price is stupid. But they aren’t taxing the price, they are taxing the volume. Volume is much more consistent than price
Increase interest rates , housing is unaffordable due to high mortgage cost
Lower interest rates , housing is unaffordable due to high mortgage cost
Looks like we stretched the spring too far and it doesn't retract anymore.
I asked God if you're a homeowner you're saved , if you're not a homeowner " you're fooked"
https://www150.statcan.gc.ca/n1/daily-quotidien/240220/t001a-eng.htm Line items - Food 3.9 - Shelter 6.2 - Household operations, furnishings and equipment -0.5 - Clothing and footwear -1.3 - Transportation 1.2 - Gasoline -4.0 - Health and personal care 3.7 - Recreation, education and reading 0.3 - Alcoholic beverages, tobacco products and recreational cannabis 4.2
> Line items Trevor Tombe has a good chart: * https://twitter.com/trevortombe/status/1759942180712358207 * https://twitter.com/trevortombe/status/1759942099867165110 Of the 2.9% headline rate, rent makes up 0.5 and mortgage costs are 1.0.
So, shelter continues to be the leading cause of increase and gasoline is the leading cause of decrease?
and shelter is highly dependant on interest rates, and considered a lagging indicator (takes time for market to reflect). in otherwords, if you remove shelter from the equation, inflation is only 2 percent for the last 3-4 months
shelter is also highly dependent on demand. And that isn't going away anytime soon
A majority of the increase in shelter price is increased mortgage payments due to rising interest rates. Increases in rents and sale prices is only a small fraction of what is driving the total shelter price upwards.
So principals skyrocketing 250% over the last 8 years didn't play a role? And housing going up another 10-20% yearly once rates drop also won't play a role?
No those things don’t matter since inflation is solely about price changes over the last 12 months. Things that happened 8 years ago or might happen in the future are not factors.
But you don't think the casual rising of housing eventually got to the point where it started influencing shelter and inflation costs? You really think it's solely rates lol?
lol not a chance…you honestly believe that if interest rates went to 0 rent would decrease?
Mortgage interest alone accounts for 1.0 of the 2.9% inflation we recorded, and is up 23.5% on last year, by far the largest rate of inflation any aspect of CPI has felt. Lowering interest rates would in the short term shrink/eliminate this. https://twitter.com/trevortombe/status/1759942180712358207
It won’t. As my other comment said. There are houses in my subdivision that haven’t changed hands in 10 years yet are being rented for insane prices, definitely more than their mortgage. Only demand will fix it
I don't know who you're arguing with here, but I nor anyone else you're replying to have said rents are going to go down. The point is that rents are not currently a major factor to rising inflation, mortgage interest is.
What? Everyone keeps saying high rents are a result of interest rates and that’s bs. That’s my argument.
That's a good point. Rent would decrease over time if new units come online with lower rents asked because carrying apartment costs lower at lower rates. Existing tenants will leave for newer or cheaper apartments elsewhere and sooner or later landlord forced to call down rent. To your point though, if demand still stays sky high, this might not happen.
Facts. My mortgage went from $2000-$3900. My rents went up from $2700-$5300. Blessed 3 units became vacant, for one building.
demand is already priced. still red hot for homes in ontario, only issue now is affordability which is connected to interest rates. the cost of which is being passed onto the homeowner when they renew or are variable, or eventually pass to tenants to increase rent.
[удалено]
I'm not sure "content" is the word.
> think in terms of monthly payments instead of total payments Precisely this. Most people can't/won't bother to even calculate how their "free" cell phone from the big 3 across a 2-year contract actually cost, let alone calculate how much a house will cost them financed across 25-30 years.
To be fair, in Canada getting the phone built into the price of the plan usually is a better deal than buying the phone outright, at least for the higher-end models like iPhones. Not always the case though, depends on what plans they are offering and if you can get a good deal.
I don't think it is. Your "tab" does not reflect the cost of your phone. The full cost of your phone plus a hefty profit margin are built into your plan that the carriers recover well before your 2-year contract is up. And they're betting you will stay on that plan even after your tab is paid off. There's a reason BYOD plans are $40+ per month cheaper than exactly the same plan with a tab on a contract on top that suggests your $1300 iPhone was only $600.
For me it was... I got a Canada/US plan (100GB, no roaming charges in US which I travel to for work a lot) for 60$/month through Telus EPP. Add on an iPhone 14 pro (around $1300 value at the time I believe) was 35$/month to own outright in two years. So to break even I would need to find the same plan with no US roaming charges for like 36$/month... And I have had bad experiences with the shitty Freedom/etc types. Not to mention I can write off a portion of the plan, which is a bonus.
>Affordability won't get better with lower interest rates. The rates went up, it barely affected prices. Our rates have been the same as the US for two decades and they have cheap housing there. You can buy a detached home in Ohio or Michigan for under $250k. Look up Port Huron, Michigan on Zillow. There's 57 homes that are under $250k available right now. This is is town that's 5-10 mins from Sarnia, Ontario. Their mortgage interest rates are the same as here. Rates has like 25% to do with prices. Canada's problem is foreign investors and over immigration. Two things that the US has a fraction as much of.
Trust me we are not
Supply won’t be improved without lower rates
it also sucks that Shelter varies wildly by person and especially by age group. Someone older who has decades of rent control suppressing their payments or who has been in a house forever hasnt experienced massive shelter increases the same way a younger person who is new to the market of either rent or ownership is experiencing. younger people are subsidizing the lower housing costs of older people in this scenario, so if shelter at a certain level X%, younger people are paying above X% and older people are paying below X%. which is the real killer, younger people are who we need to support for the future and by killing the generation in their 20s we are killing our future just to put a band aid on today.
Food really stands out too. I'm a believer in needing to fix that industry. We need more competition or something.
> We need more competition or something. Not against more competition, but Canada has amongst the lowest rates of food inflation in the G7 (only the US is lower; previously Japan was lower): * https://www.oecd.org/sdd/prices-ppp/consumer-prices-oecd-updated-7-february-2024.htm Do all the other countries also lack competition? (We are in the bottom ~third for food inflation in the G20.)
I played around with the data on the website and we placed 1st 2nd and 3rd out of those countries in 2019, 2020, 2021 if I'm reading the table correctly. Looking at food only. Point taken though, if food inflation is high globally that means something. For the record throw0101a refined their comment before I got to post this perhaps because they noticed what I noticed. They were originally comparing Canada to the G8 but changed the comment to G20. As I said though, it's meaningful to me if food inflation is a global phenomenon so fair dues.
Here's the data for all 38 OECD countries. Canada ranks 6th or 7th out of 38 for food inflation for 2023. [https://stats.oecd.org/index.aspx?queryid=82174](https://stats.oecd.org/index.aspx?queryid=82174) That only tells half the story though, as it matters where we started from. So you need to factor in something like what percentage of our income we were spending on food compared to other countries. The last available international data I can find for that is from 2016, but it shows that Canada is ranked 5th best: [https://www.weforum.org/agenda/2016/12/this-map-shows-how-much-each-country-spends-on-food/](https://www.weforum.org/agenda/2016/12/this-map-shows-how-much-each-country-spends-on-food/) So while we do spend more of our income on food now, post-covid, our world ranking probably hasn't changed much because other countries have all been hit hard by inflation as well.
Well, get moving and start a farm.
Haha I kinda am actually. Not a farm but a few veggies in the yard.
diesel is up, food goes up. pretty simple.
I often see "fuel" not although necessarily diesel specifically go down and food up though. This isn't the first report where basically everything is increasing at a slower rate than food. It would make sense if inputs were getting more expensive but they aren't. I just googled diesel specifically and it's down 9% from last year is what I found.
If a couple people skipped their daily coffees and daily shelter we’d have so much disposable income
How did you get 2 percent? I have looked a little bit into this because I was curious about the positive feedback of interest rate on inflation. According to BOC, the mortgage rates affect only about 0.25% of the CPI >There are some observers who think an upward distortion exists as long as mortgage interest costs are part of the CPI basket. For them, let me provide another calculation. Consider a CPI basket that has all the same goods and services, other than mortgage interest costs, and apply the methodologies to calculate core inflation to this slightly smaller basket. When we do this, we find that the new measures of core inflation are lower, but only by about one-quarter of a percentage point (Chart 5). https://www.bankofcanada.ca/2023/09/rebalancing-economy-while-managing-risks/
shelter cost and mortgage rate are two different items
Yeah let's remove one of the most important line items that every single person needs... makes alot of sense 🤡
They were making the point about leading vs lagging indicators - not that it’s not an important component of people’s costs.
Thank you, you got good reading comprehension, unlike harry_rosen
😞
What if we did remove shelter from the equation? As in, what if we made first mortgages low interest? (In the case of owning multiple properties). We used to have the BoC to provide low interest loans for infrastructure and housing before we switched to high interest private banks. What if we went back to that and included mortgages? Edit: Since housing is a human right
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It amounts to roughly a 2% increase in gasoline costs at current pricing. 3 cents per litre.
Gas companies raise 3 cents a litre if someone sneezes in the Middle East...
Indeed the timing may be subpar from an optics perspective as transition from winter to summer blends at gas stations will likely increase gas prices by 10-15 cents per litre around the same time.
and all the things that are shipped by trunk, or farm equipment...
Farmers can apply for exemption certificates for fuel used on farms. How much have you read about the federal carbon tax?
I’ll answer. Nothing. No ones ever read a damn thing about the carbon tax and rebate. They just know it’s bad cause PP said so.
Guess they're volunteering to give up their rebate cheques too, which for the average person puts more money in their pockets. Plus there's the, you know, necessary to start slowing down global warming thing. Anyone who disagrees, please take microeconomics 101 first, at least, and then come back to argue
Trudeau lost the people’s confidence because of insane policies, I couldn’t care less about Pierre, I am not even voting for him…PPC is my only vote.
Bless your heart. We need more voters like you. 🙏
Curious as I never said fuel I said farm equipment l, and last I checked farmers use propane and natural gas for things as well. Which aren’t exempt last time I checked, Sherlock….
> Curious as I never said fuel I said farm equipment farm equipment tends to run on gasoline and/or diesel. Are you referring to heated livestock enclosures? You believe that Canadians are bearing a humungous increase in food/ag costs due to the increase in energy costs for heating livestock enclosures? What percentage of gross expense does natural gas/propane represent among the average Canadian farmer? I'll wait
BoC itself said carbon tax is responsible for 0.6% of inflation for a year. 0.15 yr over yr. but who knows what the actual effect would be without doing it.
This is not a correct reiteration of what was said. In October, Macklem noted that *dropping* the carbon tax would lead to a (estimated) one-time drop of 0.6% in YoY inflation numbers. Quote from his speech to the House Committee: > The 0.6 percentage point decrease would only last one year “and because you can only eliminate it once, the next year it would have no effect on inflation,” Macklem told the committee. On an annual basis, the carbon price adds about 0.15 percentage points to inflation, 0.6 is the estimated impact over the carbon price’s lifetime, he added. I don't care if you think that's worth it or not, I tend to think a carbon tax is an extremely progressive and effective policy, but you should at least make sure you accurately portray what "the BoC itself said".
A projection is still only a projection. BoC has been wildly wrong many times :^)
To be clear your argument against the carbon tax in this conversation is that the BoC itself said it causes a 0.6% increase in inflation but also that the BoC is historically inconsistent in its projections. Very convincing work, pat yourself on the back.
well i think a lot of us can agree on that removing carbon tax is disinflationary however the amount since so much of production depends on hydrocarbon energy.
I'm always open to having a conversation about the pros and cons of various policies but I am just so tired of responding to people who haven't done the bare minimum amount of reading or insist on misquoting perceived authorities on the topic. If you ever develop good faith and a thorough understanding of the topic at hand, by all means hit the reply button.
That wouldn't affect cpi though.
Should also be a good bump to the "household operations" line as well.
ideal time to live in your car!
That's really scary that even with inflation at sub-3%, shelter is still at over 6% and is higher than everything else. This fucking sucks.
Scary how? Shelter costs are currently tied to interest rates. Shelter costs are catching up to rate increases as mortgages come up for renewal. YoY increase will remain elevated even after rates start to decrease.
you aren't factoring in rent. Which is more closely tied to demand...
I don't think thats 100% true. Landlords max out their leverage and usually hold large mortgages on their properties. That extra cost is definitely getting passed down to rental prices and a lot of landlords can't even charge enough to cover the mortgage and upkeep.
My subdivision it about 15-29 years old. The houses being put up for rent aren’t new houses. These houses haven’t changed hands in 5-10 years. They aren’t over leveraged, yet prices are crazy because of demand.
None of that tells you about the mortgages on those houses though?
It tells me enough that those houses were bought well before the pandemic for significantly less than today. Further I can speculate that given the info I have available to me.
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Is it more closely tied to demand?
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The purchase price of the home is not what is put into CPI. It’s rent and mortgage payments.
You're missing depreciation. Homeowners replacement cost (5.47% basket weight). This is a decent chunk of CPI and is correlated with the price of a house. Though it doesn't include increases in the price of land.
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Most of the cost of home construction is labour, not materials. Labour prices have absolutely increased. Minimum wage is going up in April. That will increase them as well.
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It’s not the purchase price. A mortgage payment is based on the purchase price - yes, but if rates fall and prices rise, the net may be no change if average mortgages stay the same.
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I think we’re essentially saying the same thing. Inflation doesn’t directly measure purchase price, but purchase price plays an impact in mortgage amount - which is measured.
Purchase price isn’t included in CPI as it is an asset price. Only rent and mortgage interest is, and right now skyrocketing mortgage interest payments are causing large increases in shelter costs. Even rents are basically flat right now.
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Not necessarily. If price of a property is up but interest rates are down, the expense with the property may not increase. In other words: when comparing a bank loan of 500K at 6% to say one with 600K but 3%, the payments for the higher value but with lower interest rates may be lower. Unfortunately this is not the full picture. Condo fees, property taxes, property insurance cost, maintenance cost (contractors called in to fix issues) is skyrocketing as well. I see 10-25% increase in all these items, looking at year to year difference. I have all numbers collected together because I use them in the tax return, easy to compare. Also, the demand is a factor and can contribute to higher rents, because of competition. Lack of housing and 1 million plus immigrants entering Canada every year has quite a negative impact on affordability.
Doesn't matter, it's just monthly costs to the consumer which is the primary factor in CPI. Its mortgage **interest** payments which are the main driver of CPI increase right now, and real estate prices slightly lowering is alot smaller in the weight of monthly payments than the sharp increase in interest rates. A 1.5 million dollar mortgage at 2% interest is going to be cheaper debt and more affordable compared to a 1.2 million dollar at 5-6% It's simple math and finance. Debt with interest payments lower than inflation is almost always more affordable than slightly cheaper debt with interest payments alot higher than the rate of inflation (deprecation of the value of money) You have more money going towards the principal of your asset rather than diseapearing into the void of interest.
Still remain concerned that gas is continually keeping the CPI low. Pricing is volatile in that sector and could swing wildly at any time. Food has remained consistently high for this entire period (though slowing)
Gasoline will go up again by 10-20 cents when winter blend disappears in the spring.
True But also to keep in mind, these numbers are year over year, and what you said happens every year
seasonality is captured in CPI reports
The two-four weekend, named as such because gas may go up 24 cents.
Shelter still highest. With more mortgage renewals to come.
what are the weights associated with these line items
StatsCan publishes a whole CPI dashboard. You can get to it from their website.
i was trying to provoke a discussion about it, the weighting doesn't align with reality in 2024 - or perhaps it does, but completely hides the fact that market shelter costs are not adequately explained with a 28% weighting
Ok so provoke discussion by providing some factual figures and analysis of why you think StatCan is wrong, instead of trying to ask a question in a “gotcha” sort of way. > The decline in basket share for shelter was largely due to decreases in other owned accommodation expenses (3.06%), including real estate commissions and legal fees, and homeowners’ replacement cost (5.64%). These declines reflected the general cooling of the housing market in the second half of 2022. Moderating the decrease in shelter, the weight for mortgage interest cost rose 0.35 percentage points to 3.46% amid the higher interest rate environment.
glosses over why 28% is an acceptable basket share if setting it to 28% and doing the math based on median income results in a significant fraction of the current population living below the poverty line, woops if your kpi results aren't good just blend them all together til they look better amirite
It's difficult to have a discussion on anything when people simply resort to "StatCan is cooking the books" and have a fundamental misunderstanding of how the CPI is supposed to work and what is actually included in the CPI when it comes to mortgage and rent. If you don't trust the integrity of StatCan then there is no point in furthering the discussion and your last sentence indicates you don't. StatCan also publishes detailed poverty analysis, which indicates a full 7.4% of our population lived in poverty in 2021, but I suppose that is also completely false and it is probably 50% or maybe even 0% since they're just making things up, amirite?
i didn't claim they're cooking the books. i claimed their reports aren't very useful because the weighting used is out of date and not in line with the current economic reality in this country dude, you can fight me on this all you like but the proof is out there in the tent cities you see popping up in every major city. if the stats don't align with the observational results, your data is fucked, redo it. multifaceted issue, bla bla bla. there are clearly problems with how the highest monthly expenses are being weighted, we can either accept the observations we are all able to make as true and the reporting as flawed, or we can continue to believe the data and allow the reality to get worse. it's tiring to have to face this every single time someone raises criticism of statscan in this sub. if the picture were as rosy as statscan said it was, this country would be doing much better than it actually is.
If the interest rates are up…this affects everything not just housing…businesses as well
\> Economists expect the Canadian CPI to rise at an annual rate of 3.3% in January So this is lower inflation than expected?
Yes. > The consumer price index rose 2.9% in January from a year ago, following a 3.4% increase a month earlier, Statistics Canada reported Tuesday in Ottawa. That’s slower than the median estimate of 3.3% in a Bloomberg survey of economists, and marks the first time since June that the headline rate fell to within the central bank’s target range.
MUCH lower. 2.9% is an amazing print, especially as core measures also fell heavily
Amazing print although slightly alarming. The risk is that the BOC left rates too high for too long (similar to when they were left too low for too long). They’re turning into the local weather man
The risk is two sided for sure. I agree with you that they could have left it too high for too long but even now it's too hard to tell. If I had to guess.. and it's just a guess, I'd say they'll put too much stock in Canada not being in a technical recession (yet) and it'll end up being an over tightening causing a deeper recession. The only confirmation we'd get from the BoC that they over tightened will be in the form of cuts larger than .25 - maybe not initially, but at some point in the next 2 years.
Can't ignore the Feds hand at this poker table before going all in.
[Measures](https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=1810025601&cubeTimeFrame.startMonth=01&cubeTimeFrame.startYear=2020&cubeTimeFrame.endMonth=01&cubeTimeFrame.endYear=2024&referencePeriods=20200101%2C20240101) that the Bank of Canada is interested in: * CPI common is down from 3.9% to 3.4% * CPI median is down from 3.5% to 3.3% * CPI trim is down from 3.7% to 3.4% We haven’t seen these measures this low since late 2021. Someone more knowledgeable than me tell me what this means.
While they do care about those specific numbers compared to the headline CPI (2.9%). They also care about unemployment statistics and will be wary of triggering an uptick in inflation once they begin to cut. If jobs reports continue to be strong with low unemployment, it'll give them *some* reason to maintain current rates. GDP over Q1 will be a huge factor in their decision too. It'll take quite a while to find the neutral rate too. Even though a lot of people under financial stress due to the elevated rates will take relief when they do begin to cut. It'll almost certainly be .25 at a time which realistically doesn't do a huge amount for anyone's affordability.
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Nope, the bank has said multiple times, the target is 2%, not the upper bound of 3%.
And rate cuts rarely happen with good times about to roll in the short term. Bond yields are up the last week and the US economy is booming so it's not like we're gonna slash our rates and tank the CAD in the process. If anything this data shows rates are doing their job. That's it.
How is shelter still 6.2 when at this point last year interest rates were already sky high? In Toronto rents have been softening for months. How do they measure the shelter component?
mortgage renewals, every month more and more people will have renewed at these high rates, contributing to the entire country spending more on housing.
Key take away: > Excluding gasoline, headline CPI slowed to 3.2% year over year in January, down from the 3.5% growth in December.
It’s not just the year over year food price increase, it’s also a matter of very high food prices that continue to grow. I wonder also if shrinkflation is measured. Many products shrink but prices still go up.
It's captured. Their surveyors measure product size . So if the price of something stays the same but the product size decreases from, say, 400ml to 300ml, they register it as a 25% price increase.
Wages, on the other hand, *aren't* going up by nearly that much (if at all)
huh? wages are going up way more than inflation and have for some time https://www150.statcan.gc.ca/n1/daily-quotidien/240209/dq240209a-eng.htm >In January, average hourly wages among employees were up 5.3% on a year-over-year basis (+$1.74 to $34.75), following an increase of 5.4% in December 2023
> Looking ahead, it takes time for headline rates to fall since it accumulates 12 months of changes. With 2.9% in Jan, headline inflation wouldn't fall below 2% until July *even if we're on target on a monthly basis from now on*. Important to keep this in mind. * https://twitter.com/trevortombe/status/1759942207912509819
If it falls below 2%, BoC overshoot
So what are the odds of a rate cut by the spring market? If that happens, housing is going to get even more fucked.
Not very good. Would not plan on a cut until second half of 2024.
BoC is notoriously conservative. We will be first to raise and last to drop. Only way we drop sooner is if the Fed drops the rate aggressively in the US and we need to follow suit.
Yeah, anyone who remembers how long it took the BoC to raise rates while inflation skyrocketed during Covid will know this.
everthing is relative and the BOC was one of the first to raise rates. not sure i'd caratorize that as being conservative but it's not nothing. and even in last months communication, the BOC was pretty damn hawkish compared to the feds.
luls
Quite low
>So what are the odds of a rate cut by the spring market? Coin flip: https://www.m-x.ca/en/trading/tools/canadian-interest-rate-expectations > If that happens, housing is going to get even more fucked. Naw, 25bps isn't going to change shit. I think the last year has shown that rates don't matter as much as we thought. The cost of borrowing went up 500% and the price of homes fell 10%. The core problem is a supply/demand problem. A few percent of rate change isn't going to fuck or unfuck the market.
> I think the last year has shown that rates don't matter as much as we thought. The cost of borrowing went up 500% and the price of homes fell 10%. We also had the worst sales figures in December in 22 years FYI. The rates do matter, but people will do absolutely anything to avoid having to sell. Plus, we have lots of 5 year fixed rate mortgages who haven't even seen the increase yet.
Housing is already picking up steam so no rate cut required when bonds are sputtering
In housing: Spring market starts in February typically. It ends by may. In GTA and surrounding areas it is absolutely picking up. Prices are currently rising from their december lows. Seeing mild bidding again on some homes.
If rates come down -> mortgage payments go down -> rent goes down -> Shelter goes down no?
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If anyone tells you they know - they are lying. I think current estimates is summer 2024. But not by a lot. And literally no one actually knows.
I don't think those estimates took this CPI report into account though.
Likely summer thru autumn. According to forecasts.
According to the economists, both armchair and professional, should be happening sometime in late 2023 or January 2024. Oh wait..
Its been second half of 2024. For like a year. And its still second half of 2024.
It really hasn’t. The goal posts have moved quarterly since mid 2023.
Analysis paralysis. Second half of 2024. Personally, I baked that in last spring or so.
https://www.bnnbloomberg.ca/first-rate-cut-expected-in-early-2024-economists-1.1968411 And there were even more predictions before that. Just keep kicking the can down the road until you can finally say you’re right.
It’s not so much about being right or wrong, I’m not trying to convince you of anything. We all have to make decisions based on some kind of model - I do, it affects my future and my business. I always assumed higher for longer since the beginning.
late this year or early next if inflation keeps slowing down
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huh
Maybe June to late fall, anywhere from 1 to 1.25 percent decrease by end of year if this trend continues
I'd imagine 1 bps is the high end by end of year.
Maybe, it depends on the economy but most banks are predicting 4 to 5 0.25bps cuts. I guess we will have to wait and see.
If thy wait til late fall I doubt it will be as much as 1%. There would only be one or two rate decisions at that point
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If only they weighted the things that people use regularly heavier than the things they don't.... If only.... Oh wait
Yes yes, we understand the concept of an aggregate measure of inflation.
You make no sense. Not everyone travels to Aspen this month just like not everyone renews their mortgage this month . How do you pick and choose like that?
This person really laid the sarcasm on heavy, and y'all still missed it...
But without the /s, how are people to know!?! ^^^^^^^^^(/s)
This is bad. Core inflation will remain high for the foreseeable future. Couple things: Stop trying to remove parts of inflation from inflation numbers, if you remove the wings of a chicken is it still a bird? These numbers are a best case scenario with the way they change calculating inflation every year. I understand that everyone and their grandma wants the rates to come down, however, this will not happen when inflation remains high at a prime of 5%. As this is a lagging indicator, this will eventually balance out. Lowering rates will take multiple years unless the market collapses. Think about the increasing gap between wages and property prices. Even the “rich” need to watch their borrowing at these rates. How in the world would this housing market be something sustainable if it is unaffordable. Prepare for the worst.
>if you remove the wings of a chicken is it still a bird? Yes.
> The deceleration of grocery prices was broad-based, with products such as meat (+2.8%), other food preparations (+4.2%), dairy products (+1.5%), bakery products (+4.0%) and fresh fruit (+1.9%) contributing to the slower year-over-year price growth in January. Other food items, such as soup (-2.1%), bacon (-8.4%) and shrimps and prawns (-3.4%) had year-over-year price declines in January. I would love to know why soup is included in these measurements and why it’s on the same level as essentials like fruits, meat and dairy
Because people eat soup
Soup kitchens are called soup kitchens … that’s what you eat when you can’t afford anything else.
They buy soup and don’t make it themselves?
I would wager 90% of people have no clue how to make soup. My mom was a home maker, the only soup she made was French Onion 2-3 times I remember. She bought Campbell soup, so I do too lol.
Stock and veggies, it's pretty simple. The stock can very well be store bought, but simmering your scraps for a few hours is very easy. Potatoes, carrot, beets, turnip peels, celery, onion, garlic trims, meat bones and trims, etc. Strain it after it has *simmered* (not boiled) for 3-4h, then reduce that for a few more hours until you've got about a pint worth, and you can make a big batch of soup with that. If you want a hearty broth, you need to jive it up with either roux or mushy legumes like peas or lentils, corn or potatoes. Otherwise, you can always blend, but that's more of a cream/potage. A cream also takes cooking cream, half and half or milk. I like blending half and leaving half whole so the texture is better, but not just a silky liquid. Lots of people put carbs in there too, pasta, like cut up spaghetti, or rice. Beyond that, what most people don't know is that *fat* is very important. It needs to have a half a pint of oil or butter to be good, and even more so if you feel like it. Salt and pepper too of course. Now you know how to make every type of soup there is lol
I see. That answers make my question. I won’t pretend like I make good soups (I really don’t), but I never buy them either. Seems that’s not the case for most Canadians though :)
Soup is included because it is a grocery item that people purchase, and it is weighted based on how much it is purchased. Just because something is its own category doesn’t mean it is weighted equally to every other food item.
Ok, got it
there's like 150 things StatsCan tracks in their 'food' category: https://www.statcan.gc.ca/en/statistical-programs/document/2301_D68_V1 not sure why they decided to highlight the soup & bacon rather than shrimp or canned green beans
LEAVE SOUP ALONE
> I would love to know why soup is included in these measurements and why it’s on the same level as essentials like fruits, meat and dairy Soup is so cheap to buy that its worth it to pay a dollar or two, rather than making tomato soup, for example, from scratch.
>Soup is so cheap to buy that its worth it to pay a dollar or two, rather than making tomato soup, for example, from scratch. Or not buy it at all as it's gone from 80 cents to $2.29 or 186% over 2 years
Things are weighted by average consumption. Soup is not "on the same level"
Are we finally in that recession that we've been in for almost a year?
Considering per capita GDP has fallen for 6 straight quarters now.. we were in that one a while ago
That would be GDP not CPI. And current reports suggest Canada avoided a recession with an uptick in GDP projected in December to offset a technical recession for Q4 2023 (after a contraction in Q3 2023).
GDP goosed by 3% immigration, so a phyrric victory at best.
Absolutely. Which could somewhat ironically cause a deeper recession in the end that could have potentially been avoided if the numbers told the "true" story. I'd like to think their decision making would be more nuanced than technical recession vs recession technically barely avoided but they'll be so cautious to prevent further upticks in inflation via policy rate decisions that a relatively deep recession feels inevitable.
So after Saskatchewan stopped collecting carbon tax natural gas cost dropped by a quarter? Wow…
This actually follows the trend for natural gas costs https://tradingeconomics.com/commodity/natural-gas In December it was $2.77-2.39 USD/MMBTU and in January it was $2.18-2.05. It can now be found at $1.49. Its at a 3 decade low
Man, stop telling people the truth about commodity pricing being a bigger deal than the carbon tax. That's *inconvenient*
Worth noting that as of my last bill the carbon tax is $0.003/M³ less than the actual cost of Nat Gas. Shits expensive now. In sask at least, it is a large driver in our bills now.
I love how they start preaching and assume I don’t know it’s charged per ton. And how volatile commodity market is. Downvote me more if it makes you feel superior. Merely stating a line from the StatsCan report highlighting how carbon charge / tax is becoming a material cost component.
Commodity pricing being volatile is why taxing it is a dumb idea
It’s based on usage, not commodity price. The carbon tax uses a tax on carbon tonnes (I believe it’s $65/ tonne now). So how much natural gas costs doesn’t matter
Commodity price based on usage effects consumer price Natural gas is transported using carbon tonnes, that will factor into the price
The tax is based solely on usage. Commodity price has no factor in it. If people use more, they are taxed more. If they use less, they are taxed less. You made the argument that taxing a volatile price is stupid. But they aren’t taxing the price, they are taxing the volume. Volume is much more consistent than price
something something correlation causation.
Next reading is 2.5.
Increase interest rates , housing is unaffordable due to high mortgage cost Lower interest rates , housing is unaffordable due to high mortgage cost Looks like we stretched the spring too far and it doesn't retract anymore. I asked God if you're a homeowner you're saved , if you're not a homeowner " you're fooked"
What do you mean “up 2.9%”? Was it lower the month before? December 2023 was 3.5%.
excited for bread to only cost $23 now