Updated
Updated · Mortgage Professional · Jul 20
Canada Inflation Slows to 2.8% as Core Measures Drop Below 2% Target
Updated
Updated · Mortgage Professional · Jul 20

Canada Inflation Slows to 2.8% as Core Measures Drop Below 2% Target

3 articles · Updated · Mortgage Professional · Jul 20

Summary

  • Canada’s annual inflation rate fell to 2.8% in June from 3.2% in May, coming in slightly below economists’ 2.9% forecast and reinforcing expectations for a prolonged Bank of Canada pause.
  • A 10.2% monthly drop in gasoline prices drove most of the slowdown, while CPI-median eased to 1.9% and CPI-trim to 1.8%—their 1.85% average was the lowest since September 2020.
  • Excluding gasoline, CPI held at 2.2% year over year, suggesting broader price pressures remained contained and that higher energy costs had not spread through the economy.
  • Some categories stayed hot: grocery inflation was 3.9%, marking a 17th straight month above headline CPI, while accommodation prices in Toronto and Vancouver rose about 20% and airfares climbed 9.6%.
  • The Bank of Canada held rates at 2.25% for a sixth straight meeting on July 15, and economists now largely expect it to stay on hold through the rest of 2026 unless energy-driven inflation worsens.

Insights

If global oil shocks and trade wars persist, can Canada’s current economic strategy protect households from lasting pain?
With Canada slipping into recession and inflation rising, could the country’s over-reliance on resources be risking its long-term prosperity?
As population declines for the first time in years, how might this demographic shift reshape Canada’s economy and social fabric?