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Prices are displayed for oranges at a store in Atawapiskat, Ontario, December 17, 2011.
Prices are displayed for oranges at a store in Atawapiskat, Ontario, December 17, 2011.
(Frank Gunn/Pool/Reuters)

Canada inflation up, interest rates next? Not so fast

As any good zombie will tell you, being undead is not quite the same as being alive. The same is true for the remarkable rise from the grave of Canada’s inflation rate.

Canadian consumer price index (CPI) inflation hit the magical 2 per cent year-over-year rate in April, its highest rate in two years, and up sharply from 1.5 per cent in March. It’s the culmination of a six-month surge that has lifted inflation from a thin 0.7 per cent last October – a pace so disturbingly low that people were talking about Canada’s looming deflation threat and calling on the Bank of Canada to slash interest rates.