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Dr. Yik Au

CBC Manitoba: Manitoba’s low inflation rate shows gas-tax cut is working, but it may also indicate a slumping economy

February 21, 2024 — 

Manitoba’s 14 cent-a-litre reduction on gas prices ultimately had an impact on the national inflationary average.

Shiu-Yik Au, an assistant professor of finance at the University of Manitoba’s Asper School of Business, said the price of gas has an outsized role on the inflation rate because energy costs impact many other factors, ranging from grocery prices to business expenses.

Still, a slowing inflation rate could be a sign that Manitoba’s economy is slumping, Au said. He noted the Bank of Canada prefers inflation rate growth in the range of one to three per cent.

“We’re starting to drift toward the too few, too little” category, Au said.

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