Canada’s annual inflation rate accelerated to 3.0% in July from 2.8% a month earlier, as a sharp run-up in pump prices overwhelmed cooling grocery costs, Statistics Canada said Monday.
On a monthly basis, the consumer price index rose 0.5%. Seasonally adjusted, the increase was 0.3%.
Gasoline drove most of the increases. Prices at the pump were up 25.7% from a year earlier, a step up from June’s 20.5% gain, after conflict in the Middle East, including the blockade of the Strait of Hormuz and the partial closure of Red Sea shipping routes late in the month, squeezed global supply.
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Strip out gasoline and the picture looks considerably calmer. That measure held at 2.2% for a third consecutive month, a sign that the July acceleration was driven by a single volatile component rather than a broad reheating of prices.
Energy costs rippled outward all the same. Transportation prices climbed 7.8% year over year, with air fares up 12.0% after a 9.6% gain in June, which the agency tied to higher jet fuel costs. Travel tours jumped 15.2%, more than double June’s 6.8% pace, as hotels and flights to World Cup host cities in the United States grew more expensive.
Groceries offered the clearest relief. Food purchased from stores rose 3.1%, down from 3.9% in June, helped by cereal products, which fell 1.7%, and fresh or frozen chicken, up just 0.3%. Even so, July marked the 18th straight month that grocery inflation ran ahead of the all-items index. Shelter costs rose 1.3%.
The national figure masked a wide regional spread. Nova Scotia posted the fastest inflation among the provinces at 5.0%, pushed by a 3.3% rise in electricity prices and an 8.7% increase in rent. Ontario sat at the other end of the range, unchanged at 2.0%.
