Inflation has turned negative for the first time since the Great Recession, the latest reminder that the COVID-19 crisis is wreaking havoc on an historic scale.
Statistics Canada on May 20 reported that the Consumer Price Index dropped 0.2 per cent in April from a year earlier, the first decline since September 2009, after increasing 0.9 per cent in March. The primary cause was all the strange and terrible things that have been happening in international oil markets, with the year-over-year cost of gasoline plunging 39.3 per cent, the largest decrease on record.
Excluding energy prices, the CPI rose 1.6 per cent, as five of eight components posted increases. Still, an official statistic that even hints at deflation is hard to look at, especially when the central bank has emptied its armoury to put upward pressure on prices.
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