Inflation rate in Canada highest since before recession

Canada's inflation rate rose to 3.3 per cent in the 12 months ending in March, the highest it has been since before the recession.

Economists polled by Bloomberg were expecting the figure to come in closer to 2.8 per cent.

Energy prices increased 12.8 per cent during the period, with gasoline prices specifically increasing by 18.9 per cent.

But prices increased on all eight components the agency tracks. Food increased 3.3 per cent as the price for fresh vegetables rose by 18.6 per cent.

"Alongside higher prices of food and energy, the 'Olympics' effect from the prior year strongly contributed to the headline gain," Scotiabank economist Derek Holt said in a note. Prices jumped temporarily in February 2010 in response to the Vancouver Winter Olympics, reversing course the following month. (read more)