Inflation rate rises due to HST -

Inflation rate rises due to HST

Price increases still smaller than analysts’ expectations


Canada’s inflation rate rose to 1.8 per cent last month due largely to the implementation of a harmonized sales tax in Ontario and B.C., and a two-point rate hike to the HST in Nova Scotia. Prices were up 2.9 per cent in Ontario and 2 per cent in B.C. Though the 1.8 per cent inflation rate was considerably higher than June’s rate of one per cent, it was lower than the 2.1 per cent rate economists had expected, which could give the Bank of Canada more leeway before it looks at raising interest rates. “While the HST made all the noise last month, the fact is that underlying inflation remains quite tranquil, neither threatening to dip into deflation terrain nor pushing above the [Bank of Canada’s annual] two per cent target.”

CBC News

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Inflation rate rises due to HST

  1. The headline is misleading. It should say Inflation lower than analysts expected. That's poor reporting in my book!
    Judith K.

  2. Doesn't the BOC know that when they raise interest rates the consumer is the one that pays the bills. The banks coff up the little they pay for operating funds and in turn double the charge rates to their customers. The bottom feeders are being squeezed through no fault of their own. It is hard to tell which operating authority the banks or the governments have the most damaging effect on Canadian taxpayers and consumers. WHAT CHA GONNA DO WHEN THE WELL GOES DRY ?

  3. Gordo says businesses will reduce pices as the cost of auditing the HST reduces their costs and will be passed on to consumers. Yeah right, and if you believe that I know one one blue democratic Liberal in Victoria. A quick check around town at fast food outlets show that prices one week before HST and 3 weeks after, there has been price increases of 15- 20% before HST is applied. So much for lower prices! A&W for example had the Bacon and Egger Combo at $3.99 one week before HST was initiated, today it costs $4.89 before HST, so much for Gordos view of the world!