Statistics Canada reported on Wednesday the country’s consumer price index (CPI) rose 0.5 percent m-o-m in March, the same pace as in the previous month.

On the y-o-y basis, Canada’s inflation rate surged 2.2 percent last month after advancing 1.1 percent in February. This was the highest inflation rate since February 2020.

Economists had predicted inflation would increase 0.6 percent m-o-m and 2.3 percent y-o-y in March.

According to the report, a significant proportion of March’s year-over-year increase was attributable to a steep decline in prices in March 2020, triggered by the COVID-19 pandemic.

Compared with March 2020, prices rose in five of the eight major components, with transportation (+7.1 percent y-o-y) and shelter (+2.4 percent y-o-y) prices contributing the most to CPI growth. At the same time, consumers paid less for clothing and footwear (-5.4 percent y-o-y) and for household operations, furnishings and equipment (-0.2 percent y-o-y).

Meanwhile, the closely watched the Bank of Canada's core index rose 1.4 percent y-o-y in March, following a 1.2 percent y-o-y advance in February.