Note: This page is now archived. Recent updates to RBC Canadian Inflation Watch here.
2023
- Headline CPI growth held steady at 3.1% in November (just above the top end of the BoC’s 1% to 3% inflation target range) despite lower energy prices and easing food inflation.
- Mortgage interest costs and rents still driving shelter costs higher. But the prior is peaking at high levels
- Underlying details continue to point to easing inflation pressures – the breadth of price growth also narrowed again in November
- And the Bank of Canada’s favored inflation gauges continue to improve, gradually moving towards the target range
- Lower energy costs and slowing grocery price growth pushed headline CPI growth lower in October
- Stripping out food and energy components, price growth is still ‘sticky’ but edged lower
- Bank of Canada’s core measures are still above the 2% inflation target but continued to look better on a 3-month rolling average basis
- Abnormally high Inflation is impacting a smaller share of products in the consumer basket
- Growth in BoC’s preferred inflation gauges slowed, but still surpassed the 2% target.
- The latest BOS survey revealed that firms anticipated lower inflation than consumers in the near future.
- Businesses’ wage growth expectations trended lower as labour markets cool.
- Gasoline prices dipped down in September but still higher than the levels from a year ago.
- Mortgage interest costs are still disproportionately adding to overall price growth.
- Higher prices at the pump pushed Canadian headline inflation rate up.
- Food costs are still high but growing at a slower pace.
- Mortgage interest costs continue to drive a disproportionate share of headline price growth.
- But the Bank of Canada’s preferred inflation measures also accelerated further above the 2% target.
- The breadth of inflationary pressures remain wide in Canada.
- The uptick in headline CPI was largely due to higher energy prices, but broader price pressures still above the BoC’s target range.
- Recent month-over-month growth in ‘core’ measures showed signs of easing, but still stubbornly high.
- The breadth of inflation is still wider than normal.
- Food price growth still high but edging lower.
- Mortgage interest costs continue to surge.
Canada’s headline inflation back in Bank of Canada’s target range
- Lower gasoline prices continue to slow year-over-year growth in the consumer price index.
- Broader inflation pressures are also weaker than a year ago—but most of the BoC’s key core measures have been ‘sticky’ at about 4%.
- Businesses are planning smaller price increases in the year ahead. But these will still be larger and more frequent than in pre-pandemic times.
- Consumers continue to expect high rental price growth over the next year. But their expectations for higher food, automobile, and gas prices are moderating.
- Inflation pressures are increasingly driven by rising rents and mortgage interest costs.
- Global drivers like commodity prices and supply chain disruptions continued to ease—and domestic pressures started to come down.
- Ongoing moderation in supply chain pressures pushed raw material and industrial prices lower.
- The Bank of Canada’s preferred core measures were at rates still well-above the 2% target.
- Firms’ expectations on wage and inflation improved slightly in recent months, but remained at high levels.
- Inflation pressures still lower than they were, but did not ease further in April
- Growth in the Bank of Canada’s preferred core measures ticked up slightly on a 3-month rolling average basis
- Grocery price growth slowing in both Canada and the U.S.
- A slowdown in cost growth for rail and truck transportation have signaled further easing in supply chain pressures.
- Travel costs remain high as demand persists.
- The breadth of inflation pressures narrowed again in March.
- Prices at the grocery store remained elevated but price growth may be past its peak.
- Businesses expect input price growth will continue to slow.
- Expectations for wage growth are also edging lower, with consumers expecting more modest increases than businesses plan to pay
- Headline and core CPI continued to decelerate.
- Moderation in the farm product price index foreshadow easing in food inflation.
- Rent and mortgage interest still surging, offsetting slower inflation for home-buying expenses and travel costs.
- Breadth of inflation pressure has stabilized but remains elevated compared to pre-pandemic period.
- The cooldown in Canadian inflation continued in January despite higher mortgage interest costs.
- Growth in travel prices slowed after busy holiday season.
- Domestically-driven inflation pressures remained as foreign-driven price pressures subsided.
- Headline CPI continued to retreat and pressures narrowed across goods and services
- Shelter inflation still robust, as higher rent and mortgage costs more than offset falling home prices
- More easing to come – businesses expected slower growth in input and output prices in year ahead
- Inflation expectations stayed above 2% for most businesses for the next 2 years, but improved in the near term
2022
- Inflation still running hot, but price pressures have narrowed
- Travel inflation stalled before holidays after summer surge
- Lower commodity prices will put a cap on goods inflation in 2023
- Higher interest rates will cut into household purchasing power in 2023 and further ease inflation pressures
- Headline CPI ticked higher as food and gas inflation accelerates
- But broader measures of inflation pressures showing further evidence of easing
- Gasoline prices still down from earlier this year but elevated diesel prices expected to add to production costs down the road
- Costs for mortgage interest payments and motor vehicles will see more acceleration as home-buying related inflation slows
- Price pressures still running above Bank of Canada target, but further signs of easing mean end of interest rate hiking cycle could be close
- Headline CPI growth eased again in September on lower gasoline prices
- Core inflation still running hot despite early tentative signs of easing in breadth of near-term price momentum
- Lower price expectations from businesses not enough to prevent further aggressive BoC interest rate hikes
- Headline CPI continued to slow in August with falling home and industrial prices flagging more declines to come
- ‘Core’ measures also ticked lower, but are still exceptionally high
- Services prices still surging on strong demand for travel and hospitality services
- Inflation pressures still too broad to prevent further central bank rate hikes
- Slowdown was led by a drop in gasoline prices, to still elevated levels above last year
- Industrial prices cooled further, as supply chain challenges keep moderating
- With more pullback in consumer spending expected ahead, inflation likely has peaked
- Pressures still too broad to derail central bank from aggressive hiking path
- Canadian inflation pressures continued to surge in June
- Home prices have shifted from big tailwind to headwind for price growth
- Industrial price growth edging lower as global supply chain disruptions show signs of easing
- Markets are betting that aggressive central bank rate hikes will cool inflation pressures
- Surging inflation is cutting into year-ahead GDP growth expectations.
- Close to half of Canadian CPI growth fueled by global price pressures, with home buying costs adding to domestic growth.
- Cooling housing market could bring some relief; although price pressure has also continued to broaden.
- Wage growth should continue to accelerate, as labour shortage issues grow more acute.
- Industrial input and output prices are still surging, keeping pressures broadly based
- Grocery prices rising at fastest pace since the early 1980s
- But central banks rate hikes are expected to slow demand
- Home buying costs (accounting for ~20% of year-over-year CPI growth) will start to slow on lower housing demand
- Higher headline inflation partly a result of rising gas prices after Russia invaded Ukraine
- But price pressures continued to broaden
- Geopolitical headwinds also adding pressure to business input costs
- Inflation expectations remain elevated for the near-term, although anchored around 2% in longer-run
- More goods and services seeing faster price growth.
- Invasion driving commodity price volatility.
- Market expects inflation to stay above 3% over 5 years.
- Prices for commodities and industrial inputs continued to edge higher.
- To-date, home and auto remain the biggest driver for price growth but pressure’s also broadening.
- Strong household purchasing power will put a floor under consumer demand and inflation trends in the near-term.
- Surging house prices underpinning higher shelter costs.
- Share of goods/services seeing higher price growth continuing to broaden.
- Wage growth to pick-up; recent gains more present for highly-skilled jobs.
2021
- Inflation pressure in Canada has been broadening, with more goods and services seeing above-target levels of price growth.
- Energy commodity prices jolted on Omicron related concerns.
- Wage pressures are building, although unevenly across industries.
- Even excluding higher shelter costs, prices in Canada have bounced back above pre-pandemic trends.
- Inflation pressure is broadening with more of the consumer basket seeing above-target rate of growth.
- Inflation expectations, from market, businesses and consumers are still edging up.
- Share of CPI basket seeing above-trend price increases from pre-pandemic levels still rising
- Energy prices have increased; industrial input prices remain elevated
- More businesses reported capacity issues related to shortages of inputs and supply chain disruptions in Q3
- Shelter prices have surged but the pace of growth is now slowing
- Motor vehicle production disruptions expected to keep vehicle prices high
- Supply chain disruptions and increased services demand taking over as driver of price growth
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- Headline CPI growth still impacted by ‘transitory’ factors but growth in industrial prices beginning to slow
- Slower demand for homes will limit further gains in accommodation related expenses
- Rising agriculture commodity prices and firming consumer demand to keep floor under price growth
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- Cars and homes accounted for much of price growth in June
- Investors are still betting that the inflation spike will prove temporary
- Cooling commodity prices to temper soaring input costs
- Consumer price increases were more broadly-based in May
- Market inflation expectations plateau albeit at elevated levels
- Rising input costs pose a key hurdle for businesses though some offset from stronger loonie
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- Inflation pressure still manageable but broadening
- Market expectations have dialed higher
- Rising Input costs and firming demand to act as tailwinds for price growth
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