By Julie Gordon

OTTAWA (Reuters). – Canada’s annual inflation rate accelerated more than expected in March. It reached a record 31-year-high amid widespread price pressures. This data was released by the official data service on Wednesday. The result points to a large rate hike at Bank of Canada for June.

In March, the headline rate was 6.7%. This is well higher than analyst expectations at 6.1%. It also marks a significant percentage point more than February’s 6.9%. This was the 12th straight month that the headline rate has been above the 1-3% range of control by the central bank and it is just below the 6.9% recorded in January 1991.

This print is likely to increase the chances of Bank of Canada raising rates again when they meet in June. Last week, the Bank of Canada raised rates half a point and stated that more inflation-fighting measures were in store.

Andrew Kelvin of TD Securities, chief Canada strategist said that a 50-basis point rate hike is always possible in June. A 75-basis point move was still unlikely, he said.

Prices of gasoline rose by 11.8% in the month, and 39.8% for the year. This was due to an increase in global oil prices following the invasion of Ukraine. Statscan reported that food prices rose 8.7% in the past year with wheat futures rising for pasta and cereals.

Statscan reported that continued inflation in wage rates was caused by high housing prices and tight labor markets. Due to rising furniture and vehicle prices, durable goods grew at an unprecedented rate of growth since 1982.

“That’s only broadening the inflation. Jimmy Jean, Desjardin Group’s chief economist said that this is a tight economic environment and tight labor markets. It sounds like the Bank of Canada should maintain an accelerated pace of Normalization.

Last week, Governor Tiff Macklem stated that the central bank will continue to “forcefully” act if necessary. There is a 65% chance that the Bank of Canada will proceed with another 50-basis point increase. It usually increases by 25 basis points.

CPI Common Measure, which is the Bank of Canada claims gives the most accurate indicator of the performance of an economy, rose 2.8% to 2.8% in March from 2.7% revised in February. CPI median was 3.8% and CPI trim was 4.7%.

The Canadian dollar rose three weeks to 1.2517 per greenback or 79.89 U.S. Cents after these data.