Inflation Rate Cooled to 6.8%

Date Posted: December 22, 2022

Canada's inflation rate cooled to 6.8 per cent last month as prices for gasoline and furniture went down, but the cost of food and rent went up.

Mortgage interest costs surged by 14.5% compared with November last year, while rent posted a 5.9% increase across the board. Grocery bills increased at an 11.4 per cent annual pace last month, up from the 11 per cent increase seen in October.

Statistics Canada reported Wednesday that gasoline prices across the country fell by 3.6 per cent during the month. They're still up by 13.7 per cent compared to where they were a year ago, but that's down from the 17.8 per cent annual increase clocked the month before.

These results arrived at a critical time between Bank of Canada interest rate decisions, with the central bank having indicated in its most recent statement that it would be deciding whether its policy rate needed to rise further following a series of hikes this year.

There will be one more consumer price index (CPI) report that will be released before the Bank’s first announcement of 2023, with the inflation rate expected to serve as a key indicator of whether the central bank deems more rate increases are necessary.

Inflation surged to a 30-year high in July, peaking at 8.1% before ticking slowly downwards in recent months.

Sources: CBC News, Canada Mortgage Professionals