Canadian Core CPI Rises 2.5% YoY in April Amid Slower Overall Inflation

Canadian Core CPI Shows Steady Increase Amid Slower Overall Inflation

Canada’s inflation rate moderated in April, with the Consumer Price Index (CPI) rising by 1.7% year-over-year (YoY), slower than the 2.3% increase in March. This result surpassed analysts' expectations, marking a deceleration in inflation.

However, the core CPI, which excludes volatile items such as food and energy, rose by 2.5% YoY and 0.5% month-over-month (MoM). This steady increase in the core measure is primarily attributed to a pickup in food prices and the removal of the consumer carbon price, which contributed to the sharp decline in gasoline prices.

Key Inflation Drivers

• Gasoline Prices: Gasoline prices led the way in lowering consumer energy costs, decreasing 18.1% YoY in April, following a 1.6% drop in March.
• Food Prices: Food prices continued to rise, climbing 3.8% YoY in April, compared to 3.2% in March. This marks the third consecutive month in which food prices have outpaced the overall CPI.
• Travel Tour Prices: Prices for travel tours saw a significant jump, increasing 6.7% YoY after a 4.7% decline in March. Month-over-month, travel tour prices rose by 3.7%, recovering from a steep 8% drop in March.

Despite the overall CPI slowdown, the increase in core inflation suggests that underlying price pressures remain, particularly in food and travel sectors.