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Financial experts worried about how Albertans' paycheques will hold up to soaring inflation

·2 min read
September energy prices in Alberta were about 22 per cent higher than a year ago.  (Jonathan Hayward/The Canadian Press - image credit)
September energy prices in Alberta were about 22 per cent higher than a year ago. (Jonathan Hayward/The Canadian Press - image credit)

Canada's inflation rate has increased more than four per cent over the past year, something Alberta financial experts say is concerning.

Statistics Canada says the national inflation rate in September rose 4.4 per cent compared to the same time last year, calling it the fastest pace since early 2003.

ATB Financial says the inflation rate in Alberta was four per cent in September, down from 4.7 per cent in August.

While the long-term picture remains unclear, ATB Financial deputy chief economist Rob Roach in Calgary says elevated costs can still have an impact, even in the short term.

"[It's] really high rates of inflation compared to what is the norm and what we've certainly gotten used to," Roach said.

"As consumers, like everyone across the country, we're feeling this when we go shopping or purchasing something."

"Prices are higher and we're going to be feeling that at least for the next few months," Roach said.

He says recent inflation rates have been spurred by factors like steep gasoline prices and global supply chain disruptions. September energy prices in Alberta were about 22 per cent higher than a year ago, with food up around four per cent.

"In the case of gasoline, it certainly is one that we do put a lot of weight on because it's a direct cost when gasoline is higher, you know, when we fill up our automobiles," Roach said.

"But it also is that indirect cost because it increases transportation, for example, of food."

Mark Kalinowski, financial educator Credit Counselling Society in Calgary, says price increases for things like gas, food and housing is concerning, and it has a much bigger impact on people who are lower income.

"When inflation goes up, it takes a long time for peoples' paycheques to catch up and what they tend to do is they start relying more and more on credit," he said.

Kalinowski said many people don't budget, and and others are living paycheque to paycheque.

"That was before inflation started ramping up. So there's a great deal of people out there that are right on that very cusp of running into issues."

ATB Financial said the annual inflation rate was 1.7 percent in 2019 and 1.1 per cent in 2020.

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