Canada's Inflation Rate Fell To 2.8% In June
Date
7/19/2023 10:46:37 AM
(MENAFN- Baystreet.ca)
Canada's Inflation Rate Fell To 2.8% In June
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Inflation in Canada continues to trend lower, with the Consumer Price index (CPI) declining to an annualized rate of 2.8% in June from 3.4% in May of this year.
Statistics Canada said that inflation in Canada was pushed lower in June primarily by reduced prices for gasoline. Excluding gasoline costs, the June inflation rate would have been 4%, said the federal agency.
The biggest contributors to price increases in June continued to be grocery costs, which rose 9.1% from a year earlier, and mortgage interest costs, which were up 30% in June from the same month in 2022.
Excluding food prices, inflation in Canada rose 1.7% in June from a year earlier. Removing mortgage interest costs, consumer prices advanced 2%.
On a monthly basis, June CPI edged up 0.1%, following a 0.4% gain in May, said Statistics Canada.
Gasoline prices declined 21.6% year-over-year in June following an 18.3% decline in May.
The decrease in energy costs was due to easier comparisons following peak prices seen in June 2022 when crude oil was trading at $122 U.S. per barrel. Crude is now trading under $75 U.S. a barrel.
Additionally, motor vehicle prices rose at a slower pace in June, advancing 2.4% after they rose 3.2% in May.
However, automotive insurance premiums gained 5.4% in June after a 3.1% increase in May. And travel tour costs rose 6.8% during the month of June.
Another major contributor to the decline in consumer prices were costs related to telecommunications. Canadians paid 14.7% less for cellular services year-over-year in June, following an 8.2% decline in May.
Prices for Internet access across Canada declined 3.2% in June on a year-over-year basis after increasing 1% in May.
The largest contributors to the 9.1% rise in food prices during June were meat, up 6.9%, bakery products, up 12.9%, and dairy products, up 7.4%.
Looking across the country, inflation decelerated in eight provinces during June, with Prince Edward Island recording the smallest CPI increase at 0.2% annualized growth.
Canada's annual inflation rate peaked at 8.1% in June 2022, but has steadily declined since then as the Bank of Canada has aggressively raised interest rates.
The Bank of Canada targets annualized inflation growth at 2%.
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