The annual inflation rate edged lower to 2.3% in January, down from 2.4% in December, as gasoline prices exerted the strongest downward pull.
Pump prices were 16.7% lower than a year earlier. The consumer prices, excluding gasoline, rose 3.0% year over year, unchanged from December.
The overall index was flat month over month and up 0.1% on a seasonally adjusted basis.
Food prices continued to rise. Prices for food purchased from stores were up 4.8% year over year, easing from 5.0% in December due to a 3.1% decline in fresh fruit prices amid stable harvests, with berries, oranges and melons.
Shelter costs also continued to moderate. Shelter inflation slowed to 1.7% year over year, the first reading below 2.0% in nearly five years. Rent growth cooled to 4.3%, with Prince Edward Island and Saskatchewan recording the sharpest deceleration. Mortgage interest costs rose 1.2%.
Cellular service prices provided some relief. Year-over-year growth slowed to 4.9% from 14.6% in December, reflecting base effects after earlier price increases.
Regionally, nine provinces recorded slower price growth compared with December. British Columbia was the exception, where inflation accelerated due to base effects tied to hotel pricing patterns in early 2025.
We see a gradual cooling in headline inflation, though core measures and tax-related distortions causes price pressures to remain uneven.