The prices for raw materials and industrial products took off in March, as the conflict in the Middle East spurred higher energy and chemical prices, according to data from Statistics Canada.
On Thursday, the national statistical agency reported that the Industrial Product Price Index (IPPI), which tracks the prices of goods manufactured in Canada, jumped by 2.4% on a month-over-month basis in March, marking a sharp acceleration from the 0.6% increase recorded in February.
Higher energy prices were the primary driver of this jump — with energy products recording their largest monthly jump on record, up 27.4% in the month — indeed, excluding energy products, the index declined 0.5% in March.
“The closure of the Strait of Hormuz, an important global shipping lane for petroleum and other products, was the main event impacting price movements across multiple commodities in March, including energy and petroleum products and chemicals and chemical products,” Statistics Canada said in a release.
At the same time, Canadian manufacturers also faced higher raw materials prices in the month.
Statistics Canada reported that the Raw Materials Price Index (RMPI) rose by 12% on a month-over-month basis in March, and the index was up 23.6% year over year, it noted.
Again, energy products were the primary driver of the monthly increase, as that component of the index was up 41.1% in March. Excluding energy products, raw materials prices were flat, up just 0.2% in the month.