Canada inflation slows to 2.2% as gas prices fall

Canada’s annual inflation rate slowed to 2.2% in October, down from 2.4% in September, largely due to a steep decline in gasoline prices, Statistics Canada reported on Monday.

Gas prices fell sharply by 9.4% in October following a 4.1% drop the month before. The decline was attributed to cheaper winter fuel blends and lower crude oil prices amid concerns about oversupply.

Excluding gasoline, the consumer price index rose 2.6%, matching the previous month. Core inflation measures also showed only modest improvement: CPI-median eased to 2.9% from 3.1%, while CPI-trim slipped to 3% from 3.1%.

Telecom prices were a notable contributor, with wireless service costs jumping 7.7% year-over-year and 8.2% month-over-month as providers raised fees. Home and auto insurance premiums were also higher, rising 6.8% and 7.3%, respectively.

Property taxes climbed 5.6% annually in October, slightly less than the 6% increase recorded in 2024.

Grocery inflation continued to moderate, with prices up 3.4% year-over-year, down from 4% in September. On a monthly basis, food prices dropped 0.6%, marking the largest decline since September 2020. Still, Statistics Canada noted that grocery costs remain elevated and have outpaced headline inflation for nine consecutive months.

Shelter costs increased 2.4%, down slightly from 2.6% the month before.

Overall, the inflation reading aligned with economists’ expectations.