• EhForumUser
    link
    fedilink
    arrow-up
    1
    arrow-down
    1
    ·
    edit-2
    1 year ago

    StatsCan uses an odd assortment of consumer goods to track inflation, which doesn’t really reflect what pressures consumers are facing in Canada

    Makes sense. Inflation only cares about the change in value of the dollar, not the sum total of the change in value of the dollar and the change in value of the good being purchased. It is decidedly not a cost of living index.

    If, for the sake of illustration, the value of bacon is up 50¢ and the dollar has declined in value by 50¢, your cost to buy bacon is now up $1 – but inflation would only be interested in the 50¢ on the dollar side of the transaction. The increase in value of the bacon is irrelevant to dollar inflation.