Canada’s lowest inflation rate of 3.4 percent since June 2021 due largely to lower gasoline prices

Representative image of Canada Inflation decline. credit: Unsplash

Toronto/CMEDIA: Deceleration of Canada’s inflation rate to 3.4 percent this year up to May largely due to sharply lower gasoline prices by more than 18 percent compared to the record highs this time last year, Statistics Canada said Tuesday,

With the nine percent increase of grocery prices in Canada on an annual basis showing little improvement from April, the long-awaited decline in food inflation has yet to come.

Based on incoming economic data, including Tuesday’s inflation report, the Bank of Canada is expected to make its next interest rate decision on July 12 after having raised a quarter-percentage point to 4.75 percent earlier this month.

The central bank is paying particular attention to its core measures of inflation.

Canada’s slower pace of inflation is due largely to prices being compared to those elevated levels in prices in the first half of 2022 after the Russian invasion of Ukraine.

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