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Today: 20.01.2018 - 15:08:31
   Canada Mortgage Hub Discussion Board -> Mortgage Rates Canada -> What will happen to Canadian exchange rate under the following two situations?
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princessnissa

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What will happen to Canadian exchange rate under the following two situations?
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Canadian mortgage rate
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ostrie

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The Consumer Price Index (CPI) tracked very closely the inflation experienced by seniors as a group between 1992 and 2004, according to a new study. This is important because the CPI is used to index old-age pensions.During this 12-year span, seniors-only households experienced an average annual rate of inflation of 1.95%. This was only slightly higher than the rate of 1.84% for all other households, and 1.86% for all households combined.The study examined the inflation rate experienced by households composed exclusively of seniors aged 65 and over, comparing them with all other Canadian households and the official CPI.Starting in 1998, seniors did begin to encounter slightly higher price increases for certain items. As a result, a small gap did grow between inflation for seniors-only households and other households, which lasted until 2002.The gap was due to price increases in items such as mortgage rates and some energy products, where trends in prices had changed since 1992. But it was not due to long-term trends in prices for items such as electronics and tuition.Seniors tend to spend a different proportion of their budget on various items than do other households. However, price gains for many of these items also tend to offset each other.The study also showed there are substantial variations in inflation between seniors from province to province, ranging from a low of 21.2% in Quebec to a high of 32.0% in Alberta. The national average was 24.4% during the 12-year period.In addition, inflation rates for seniors varied depending on their household circumstances. For example, seniors who owned their own home had very different inflation rates than seniors who rented.Senior households spend differentlySeniors may experience different rates of inflation because there are some fairly significant differences in spending patterns between them and other householdsSeniors tend to spend proportionally less on transportation items, such as new cars and gasoline, according to the 2001 Survey of Household SpendingThey also tend to spend a smaller proportion of their income on clothing and most types of entertainment, such as recreational vehicles and audio/visual equipment. And they spend proportionally less on alcohol and tobacco productsHowever, seniors spend proportionally more on travel and reading materials, utilities and rent and tenants' expensesFor example, for every $100 of their expenditure budget, seniors on average spend $56 on food and shelter, including utilities, compared with only $45 among other households.Recreational and sports equipment and services combined are the most important factors contributing to a slightly higher inflation for seniors-only households. They include such items as computers, audio/visual and photographic equipment, cable television subscriptions, travel and recreational vehiclesThe impact on the CPI of electronic items is quite large and continuous, as their prices have fallen steadily over time. However, seniors have not benefited from these price decreases as much as younger households because they do not spend as much of their income on these items.Seniors spend a relatively larger portion of their income on cable television subscriptions, a main item in the CPI's recreation category. The price of cable TV has gone up steadily, increasing 75% between January 1992 and February 2004. As a result, the increases in the CPI experienced by seniors were again pushed higherHome tenure was also an important factor in determining differences in inflation rates among seniors. For example, the national rate of inflation between January 1992 and February 2004 for seniors who were renters was only 22.7%, well below the pace of 28.1% among seniors who owned their homes.Note to readersThe study on which this release is based does not provide an official measure of senior inflation, but an examination of the differences between seniors and Canadians in other age groups.Results differ slightly from the official Consumer Price Index (CPI) due to such factors as mortgage interest and less detailed consumer basketsThe study has only examined inflation differences between seniors and all other households due to different spending patterns. However, inflation differences could also arise if seniors experience price movements different from other households for the same good or serviceFor example, if seniors tend to shop for clothes at a certain outlet while all other households tend to favour another outlet where prices moved differently, different inflation rates would be experienced by seniors compared to other households. Since there are no price data available by class of consumers, this study assumes that price changes are the same for all householdsFor the purposes of this study, individual household CPIs from January 1992 to January 2001 were calculated using the 1997 Survey of Household Spendin
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