Canada’s annual inflation rate picked up slightly in August, as a softer drop in gasoline prices and rising food costs outweighed declines in travel and fruit prices.
The Consumer Price Index rose 1.9 per cent in August compared with a year earlier, up from 1.7 per cent in July. Excluding gasoline, prices increased 2.4 percent.
Gasoline continued to weigh on the index, falling 12.7 per cent from last August. But the decline was smaller than July’s 16.1 per cent drop, partly because prices one year ago were already unusually low. Prices at the pump rose 1.4 per cent month over month this August, as refiners widened their margins despite lower crude oil costs.
At the same time, Canadians faced higher bills for staples such as meat, where prices jumped 7.2 percent from last year. Beef rose 12.7 per cent, with ground beef and processed categories leading the gains. In contrast, fresh fruit provided relief, dropping 1.1 per cent annually after climbing in July.
Telecom costs also shifted upward. Cellular service prices fell just 1.2 per cent compared with August 2024, far less than July’s 6.6 per cent drop, as back-to-school promotions dwindled and providers raised plan costs. Month over month, cell prices were up 1.5 per cent, only partly offset by cheaper digital devices such as smartphones and tablets.
Travel costs moved in the opposite direction, easing for Canadians booking tours or flights. Travel services overall dropped 3.8 percent compared with a year ago, led by a 9.3 percent fall in tour packages. Airfares declined 7.6 per cent, less than July’s 10.6 per cent plunge. Hotel prices, however, rose 2.9 percent nationally, with sharp spikes in Newfoundland and Labrador and Nova Scotia during peak tourist season and the Canada Summer Games.
Clothing and footwear edged higher, up 1.7 percent annually.
Overall, consumer prices slipped 0.1 per cent in August compared with July, but on a seasonally adjusted basis the index was up 0.2 per cent. Transportation costs, including gasoline, showed a 0.5 per cent decline over the past 12 months.