1H2007 CPI inflation
Further to Erin’s post on the odd fluctuations in the monthly inflation rate, a better approach is to look at year-to-date averages in order to smooth out these monthly fluctuations. For the first six months of 2007, the average CPI was 111.05, and for the first six months of 2006, 108.87.
This works out to an first-half of 2007 inflation rate of exactly 2.00% â€“ in other words, precisely in the middle of the Bank of Canada’s inflation target range of 1-3%. And the 2006 full year inflation rate: also 2.0%.
So one wonders, why are we so concerned about inflation and the horror of an inflationary spiral?