The higher price of gas has fuelled Canada's annual inflation rate, forcing it to spike 2.2 per cent for the first time since January, the latest consumer price index numbers revealed Thursday.
Consumer prices jumped since April which only saw a 1.7 per cent increase. The half-point jump is the biggest since September, according to Statistics Canada.
Private-sector economists were predicting a hike of about 1.9 per cent in the headline consumer price index.
A steep hike in gasoline prices has been behind the inflation drive since April, when economists noted an 11.6 per cent rise at the pump. In May, the price at the pumps rose 15 per cent on an annualized basis.
Without the jump in fuel costs, inflation would have remained at 1.6 per cent, said Statistics Canada.
The core inflation rate kept steady at 1.5 per cent as it does not include volatile items such as fuel or fruits and vegetables.
May was a record-setting month for crude oil values. Fuel oil and other petroleum products jumped 49.3 per cent from May 2007 -- the largest acceleration in five years.
Quebec saw a jump in this component of 60.4 per cent.
Last week, the Bank of Canada warned the inflation rate would take a hit because of soaring oil prices around the world. As a measure, the Bank surprised economists by not cutting interest rates.
However, there were other factors driving up the inflation rate. Automobile insurance premiums that rose 6.3 per cent, homeowner replacement costs that rose four per cent and food prices that increased by 1.9 per cent in May.
The higher cost of grains has seen the price of bread and other bakery products to jump 13.2 per cent - the fastest increase since October 1981.
Airline tickets and hotels were also slightly more expensive in May than in April.
Nonetheless, consumer prices in other industries continued to fall, relieving the inflation rate of some pressure.
The cost of buying or leasing a car has dropped 8.1 per cent on an annualized basis, mostly because of the strong Canadian dollar against the U.S. greenback. Women's clothing and computer equipment and supplies were also less expensive than they were a year ago.
While the price of baked goods increased, it cost Canadians a little less to buy fresh fruits and vegetables. However, the deceleration in price slowed in April, which means shoppers actually saw a small increase in what they were spending compared with the previous month.
With files from The Canadian Press
