Canadian Banks Urge Bank of Canada to Exclude Shelter Inflation from CPI

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Take it Out, and Cut Already!

Canadian banks are releasing reports, one-after-the-other, urging the Bank of Canada to stop using components of shelter inflation in its core CPI calculations.

I mean, why should shelter costs (needed to live) be part of the a critical cost of living index?

They argue that mortgage interest is not included in US CPI, and should therefore not be included here in Canada — but they leave out one important point: Americans can write off their mortgage interest. (or get a huge flat-rate deduction instead)

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National Bank

In their March 19th report titled: “All provinces have CPI ex-shelter at or below 2%” the National Bank writes:

“We note that CPI inflation outside shelter was only 1.3% in February, with 9 out of 10 provinces at 2% or below.”

CPI ex-shelter is exactly what you think it is — they took out all shelter costs to show: “look we beat inflation!”

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That’s perfect for human beings who dont need shelter.

They then proceed to provide a link to another one of their reports showing how shelter is “contaminating” inflation measures:

Source: National Bank of Canada

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