Food prices are dropping, but no one cares
Statistics Canada reported this week that food inflation in April stood at 1.4%, indicating that food prices in stores are 1.4% higher than they were a year ago. However, Statistics Canada also confirmed a trend our lab has been tracking for some time: food prices in April declined by 0.3%. Indeed, they dropped. Looking ahead, we might witness another negative figure from Statistics Canada for May.
Remarkably, food inflation in Canada decreased for the fourth consecutive month in April, falling to 2.3% from 3% in March. Food purchased from stores experienced a year-over-year increase of 1.4%, the lowest since July 2021. This marks the first instance since November 2021 where food inflation (2.3%) has fallen below the general inflation rate (2.7%). This is undoubtedly positive news, especially given the challenging years we have endured. Lower prices are what many Canadians have been yearning for. Yet, the reactions and comments about the inflation data suggest that few have recognized that Statistics Canada essentially announced a major shift in food pricing.
Not a single media outlet reported on this development. This omission is quite revealing, suggesting a pervasive preoccupation with highlighting negative news in the data. The data released this week was certainly reassuring for the outlook for the rest of the year. Nevertheless, it appears no one paid heed, not one bit.
This reaction stems from a deeply ingrained obsession. Food inflation has been politicized to an extreme, exploited by all sides of the political spectrum. The political weaponization of higher food prices has rendered most Canadians resistant to the rational analysis necessary to understand the current situation. It has been astonishing to observe. When one individual challenge another's narrative on food inflation, mutual accusations of conflict of interest and bias inevitably follow. We live in a peculiar era.
Underlying this awkward social discourse is a political contest between parties in Ottawa that has exacerbated the situation, cornering all parties in the process. Why would any party now want the food inflation storm to dissipate when a substantial portion of their messaging revolves around addressing the cost-of-living challenges we all face?
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On one hand, Jagmeet Singh, a vocal critic of Loblaw for alleged profiteering, appears unwilling to acknowledge that market forces are at play. Pierre Poilievre, on the other hand, also has little incentive to see the issue resolved. Why would he? It serves as a perfect political problem for the Conservatives to blame the Trudeau government, even though food inflation has been a challenge in most developed nations for a prolonged period. Food inflation has been politically convenient for both the NDP and the Conservatives, but this should no longer be the case. Yet, no one in Ottawa seems to have addressed this with Jagmeet Singh or Pierre Poilievre.
In the context of food prices, it is imperative that cooler heads prevail as soon as possible. Emotions and sentiments seem to hold more sway than data or science. Absurd. Every Canadian needs to detach from their emotions, which they often mistake for evidence of truth, and instead focus on what the data is revealing. The data clearly indicates that the situation is improving, and rapidly so.
Before leveling accusations of bias, one should spend time examining the data. Emotions and feelings, though intense, are always misleading guides to the truth.
