Canada’s CPI Increases 3.4% In December, 3.9% Throughout 2023

In December Canada’s Consumer Price Index (CPI) experienced a 3.4% year-over-year increase, up from November’s 3.1% rise. This uptick was mainly due to higher gasoline prices, which rose 1.4% compared to November’s 7.7% decline, influenced by a base-year effect.

On the other hand, the CPI saw a month-to-month decline of 0.3% in December, reversing November’s 0.1% gain. This decrease was mainly due to lower prices for travel tours and a continued drop in gasoline prices. However, when seasonally adjusted, the CPI actually rose by 0.3% in December.

The increase in the CPI was also affected by other factors. Air transportation prices saw a significant month-over-month jump of 31.1% in December, influenced by strong holiday season demand. This surge partially offset the year-over-year decline in airfare prices. Additionally, rent prices continued their upward trend, rising 7.7% year over year in December, driven by factors such as higher interest rates.

In the vehicle sector, the purchase of passenger vehicles index rose 2.3% year over year, led by a 3.4% increase in new passenger vehicle prices, attributed to the availability of new 2024 model-year vehicles.

Overall, the December CPI reflected a mix of rising and falling prices across different sectors, indicating the diverse factors at play in Canada’s economy. While gasoline prices and strong demand in certain areas like air travel contributed to the CPI’s rise, other sectors like travel tours saw price decreases, demonstrating the variable nature of consumer price movements at the year’s end.

On an annual basis, CPI rose a claimed 3.9% through all of 2023, following a 6.8% jump in 2022. Excluding 2022, the rise is the highest increase since 1991. Excluding energy, the rise is even higher, at 4.5%.


Information for this story was found via Statistics Canada. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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