Statistics Canada has reported that Canada’s annual inflation rate increased to 3.3 percent in July. This marks a notable acceleration in the pace of price growth compared to the previous month of June.
This uptick follows a drop in inflation to 2.8 percent in June, a level that had fallen within the Bank of Canada’s target range of one to three percent for the first time since March 2021.
The driving force behind the July inflation increase was gasoline prices, which experienced a less pronounced fall compared to prices from the previous year.
The report notes that last month’s gasoline prices were being contrasted with a period in July 2022 when prices had seen a significant decline due to concerns about an economic slowdown.
On the other hand, grocery prices saw an annual rise of 8.5 percent, a slower increase than in June.
This moderation can be attributed to smaller price hikes, particularly in the categories of fruit and bakery goods.
Looking ahead, the Bank of Canada anticipates that inflation will remain at approximately three percent over the next year before gradually receding to two percent by mid-2025.
