Canada’s inflation rate declined to an annualized rate of 4.3% in March from 5.2% in February, representing the smallest increase in consumer prices since August 2021.
Statistics Canada said that declining energy prices, particularly for gasoline, continue to exert downward pressure on inflation.
Excluding volatile food and energy prices, Canada’s Consumer Price Index (CPI) came in at 4.5% year-over-year in March, following a 4.8% reading in February.
Excluding mortgage interest costs, inflation in Canada eased to 3.6% in March after increasing 4.7% in February of this year.
However, on a monthly basis, inflation in Canada was up 0.5% in March, outpacing a 0.4% gain in February.
Travel expenditures (up 36.7%) contributed the most to the monthly increase in inflation, driven largely by demand during March break.
On a seasonally adjusted monthly basis, inflation in Canada rose 0.1%.
Gasoline prices dropped for the second consecutive month in March, declining 13.8% from a year ago, the largest yearly decrease since July 2020.
However, the decline in energy prices was partly offset by higher mortgage interest costs, which rose at the fastest pace on record during March, climbing 26.4%.
Grocery prices increased at a slower pace year-over-year in March, with prices for food purchased from stores up 9.7%. That was lower than the 10.6% increase recorded in February.
