Canada’s inflation rate declined further in February, coming in at an annualized 5.2% after a 5.9% increase recorded in January of this year.
The Consumer Price Index (CPI) registered its biggest decrease in February since April 2020, according to Statistics Canada.
Core inflation, which excludes volatile food and energy prices, rose 4.8% in February from a year ago, following a 4.9% increase in January.
Excluding mortgage interest costs, Canada’s inflation rate rose 4.7% in February after rising 5.4% in January of this year.
On a monthly basis, the Consumer Price Index was up 0.4% in February following a 0.5% gain in January.
During February, mortgage interest costs rose while energy prices declined. Food prices across Canada remain elevated and continue to contribute to the bulk of inflation in the country.
Food purchased from stores throughout Canada rose 10.6% year-over-year in February, marking the seventh consecutive month of double-digit increases, said Statistics Canada.
Among food items, prices for cereal (up 14.8%), sugar and confectionary items (up 6%) and seafood (up 7.4%) rose the most in February from a year ago.
The rise in grocery prices during February was partially offset by a 0.6% year-over-year decline in energy prices, following a 5.4% increase in January.
Gasoline prices in Canada declined 4.7% in February from a year earlier, which was the first annual decline since January 2021.
On a monthly basis, Canadian drivers paid 1% less for gasoline in February than in January amid higher crude oil inventory levels in the U.S.
Shelter costs also rose at a slower pace year-over-year in February, marking a third consecutive month of decline. Overall shelter costs in Canada rose 6.1% in February after an increase of 6.6% in January.
Mortgage interest costs increased at a faster rate in February, rising 23.9% from a year ago, which was the fastest rate of increase since July 1982.
The rise in mortgage interest costs occurred as Canadians’ mortgages reset at higher interest rates.
