April Inflation Hits 2.8% as Oil Prices Spike Again

Canada's inflation rate jumped to 2.8% in April, erasing some of the progress that had been made over the past year. The culprit is familiar: oil prices spiking again, which hits everything from gas pumps to heating costs to the price of goods that need to be shipped.

For Toronto residents, that means the cost of filling up and heating your home just went up. It also means that businesses that rely on fuel—restaurants, delivery services, construction companies—are seeing their margins squeeze. The inflationary pressure ripples out in ways that are hard to see immediately but easy to feel over time: slightly higher restaurant prices, slightly slower wage growth, slightly less purchasing power.

The Bank of Canada has been walking a tightrope between fighting inflation and avoiding a recession. These numbers suggest the tightrope is getting narrower. Oil volatility isn't something Canadian policy can control, but energy prices have always been one of the wildcards in inflation forecasts.