The country's annual inflation rate surged more than a point to 3.3 per cent last month - the biggest year-over-year leap since September 2008, Statistics Canada reported Tuesday.

Prices were also up 1.1 per cent on a monthly basis -- the fastest jump since September 2008, before the financial crisis hit.

"It was a huge jump," said Ian Lee, business professor at Carleton University. "I think it caught everybody off guard. It was not supposed to come in this high."

If the economy sees another month of high price increases, it will put "great pressure" on Bank of Canada Governor Mark Carney to raise interest rates in May, Lee said.

The BoC aims to keep inflation between one and three per cent. Last week, it opted to keep its key interest rate at one per cent, forecasting that inflation would hit 3 per cent this spring and then ease off.

Statistics Canada said prices rose in all eight major components that it tracks. But the main contributors were fuel and food prices – exactly where consumers feel it most.

"Nothing's good anymore. It used to be at one time you could get a few buys, now you have to go from grocery store to grocery store, to find the cheapest prices," Pat Arsenault told CTV News in Halifax

"Electricity, fuel, all that kind of thing. Definitely a big increase," added Brian Gallant who is retired and on a fixed income.

Gas prices rose 18.9 per cent, while fuel oil and other fuels surged 31.3 per cent. Electricity costs increased by 4.3 per cent. Transportation costs, which have a heavy gasoline component, were up 6.6 per cent, as consumers paid more for car insurance and air transport.

On Tuesday, the average price at the pumps in Canada was nearly $1.30 per litre, according to the website GasBuddy.com.

Frank Atkins, an economics professor at the University of Calgary, said that in Canada rising gas prices are being driven partly by growing demand as the summer driving season approaches.

"Then you add into the mix that we haven't built a new refinery in 25, 30 years and so we don't have enough refinery capacity. All this is squeezing these gasoline prices up," he said on CTV's Power Play.

When energy prices are excluded, the Consumer Price Index rose 2.4 per cent in March, year over year. And when eight of the CPI's most volatile components are excluded, the core rate of inflation picked up to 1.7 per cent.

Food costs rose by 3.3 per cent -- the largest year-over-year advance since August 2009. That was in part because the price for fresh vegetables rose by a stunning 18.6 per cent.

"The cost of meat rose 5.0 per cent in March, as beef and pork prices increased. Higher prices were also recorded for bakery and cereal products as well as for dairy products," the agency noted.

Shelter costs, with the exception of mortgage interest, recreation, household operations, health and personal care, alcohol and tobacco, even clothing and footwear were all higher in March than last year, though the gains were modest.

Craig Alexander, chief economist for TD Bank Financial Froup, said it's the higher gas prices that are hitting Canadians hardest but he notes the rising cost of oil is a double-edged sword for Canada.

"Higher gasoline prices are having an impact on household wallets. The average family spends about $3,500 a year on gasoline. And there's been about a 20 per cent increase in the price of gasoline," he told Canada AM Tuesday.

With Canadian families spending about $700 more a year on gas right now, "that's a punch," Alexander said.

"But for the Canadian economy as a whole however -- it sounds a little perverse, but because we're a net oil-exporting country, higher oil prices are good for Canada... So it's bad for households but it's good for some regional economies… like Alberta, Saskatchewan and Newfoundland."

Computer equipment and supplies were one area in which prices fell, dropping 9.9 per cent. Video equipment dropped 10.4 per cent. Prices for fresh fruit and natural gas also fell.

But the overall trend toward higher prices is part of a larger international trend that could be a positive sign for the global economy, according to Carlos Leitao, chief economist at Laurentian Bank Financial.

"Inflation in Canada and around the world is certainly on the rise… I think the days of extremely low inflation, as we had it in 2010, I think those days are behind us," he said.

"One of the reasons why we see a bit of inflation and higher interest rates is because the economy is actually operating at a higher level of capacity utilization. In the end, that's good news."

Here's what happened in the provinces and territories. (Previous month in brackets):

• Newfoundland and Labrador 3.2 (2.9)
• Prince Edward Island 2.4 (1.9)
• Nova Scotia 3.9 (3.4)
• New Brunswick 3.1 (2.2)
• Quebec 3.3 (2.2)
• Ontario 3.6 (2.5)
• Manitoba 2.8 (2.1)
• Saskatchewan 3.0 (2.2)
• Alberta 2.0 (1.2)
• British Columbia 3.1 (1.8)
• Whitehorse, Yukon 3.2 (1.3)
• Yellowknife, N.W.T., 3.1 (1.5)
• Iqaluit, Nunavut 1.7 (1.1)

With a report from CTV Atlantic Bureau Chief Todd Battis