19.08.202512:34:01UTC+00Canada Inflation Rate Falls More than Expected

In July 2025, Canada's annual inflation rate decreased to 1.7%, a slight drop from 1.9% in June and below the anticipated 1.8%. This marks the fourth consecutive month that inflation has remained below the Bank of Canada's 2% target midpoint. A key factor in this trend was gasoline prices, which fell by 16.1% in July, following a 13.4% decline in June. These decreases were primarily due to the ongoing impact of the removal of the consumer carbon levy in April, which continued to lower energy costs. Excluding gasoline, prices increased by 2.5%, consistent with figures from May and June. However, the decline in inflation was moderated by rising grocery prices and a less significant reduction in natural gas costs. Food and shelter-related expenses showed an upward trend, increasing by 3.3% and 3%, respectively, compared to a 2.9% rise in both sectors in June. The trimmed-mean core Consumer Price Index (CPI) remained stable at 3% in July, unchanged for the third month in a row, an indicator closely watched by the Bank of Canada to gauge underlying inflation. Month-on-month, the CPI rose by 0.3% in July, a slight increase from the 0.1% rise in June and in line with market expectations.