Inflation continues to climb, but relief may be ahead

By Drew Stremick

Inflation is taking its toll on Canadians from coast to coast, driving up the cost of everyday items families need most.

Dr. Jason Childs, a professor of economics at the University of Regina, said it has always been the same three culprits.

“Food, shelter, and transportation. That’s been driving this inflationary cycle since the beginning,” Childs said on Gormley this week. “(It’s those three) over and over and over again.”

In an attempt to bring inflation more in line with predictions, the Bank of Canada increased its key interest rate by a quarter percent to 0.50 per cent earlier this month.

Combining that with lower spending now that Canada is continuing to recover from the COVID-19 pandemic is a good start, Childs said.

“We might get back to lower inflation if (Bank of Canada officials) don’t increase the money supply again for a while.”

One thing that concerns Childs is how the rising costs in certain industries apply pressure on others.

“One of the things we’re learning based on what has happened and how different prices have moved is how long it takes for that inflationary pressure to bleed into other categories.”

Despite all the doom and gloom, there is good news here in Saskatchewan. Childs said relative to the rest of Canada, the province is doing well and only at about 4.7 per cent overall headline inflation.

“So we’re doing pretty well, and we aren’t seeing the big run-ups in housing and we aren’t seeing the big run-ups in transportation costs compared to other jurisdictions,” Childs explained.