Inflation Update: Canadian inflation drops down to 3.4% for May

Canadian inflation has slowed to 3.4% from the April’s previous report of 4.4%.

This is the lowest inflation has been in almost two years. However, much of this decrease can be attributed to fuel and energy costs being significantly lower than this time last year when we saw a spike in energy prices resulting from the Ukraine/ Russian war.

Mortgage interest costs also continue to heavily influence inflation with an increase of 29.9% over the last year.

We continued to see increases to categories including restaurant food, while grocery prices have remained elevated with no sign of any notable changes from April.

Although this sizeable decline to inflation aligns with the Bank of Canada’s objective of reaching their inflation goal of 2%, core inflation still remains steady with increases to numerous categories comparatively month over month. Therefore, unfortunately there is still a chance that we could still see another rate increase in July.

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