Canadian Inflation Slows To Lowest Level Since June 2021 Despite Mortgage Costs Seeing Largest Increase On RecordDespite soaring mortgage costs, Canada’s annual inflation rate slowed to its lowest level in nearly two years in May., inflation rose 3.4% year over year in May, the smallest increase since June 2021 and down from 4.4% in April.
In the first half of 2022, Canadian consumers experienced significant price increases as the global economy reacted to Russia’s invasion of Ukraine. As time passes, these price increases will fall out of the monthly calculations, which will have a downward effect on headline CPI.Prices for durable goods also grew at a slower pace in May, rising 1.0% annually. The increase is the smallest since May 2020, and coincides with easing supply chain issues.
While inflation has slowed in recent months, it remains well above the Bank of Canada’s 2% target. Prices continue to be elevated, particularly so where food is concerned.