Canada’s inflation rate dropped sharply last month.
On Tuesday, Statistics Canada said that the country’s annual inflation rate fell to 3.4% in May after reaching 4.4% in April to the surprise of many.
One of the biggest reasons for this huge drop? Gas prices.
Gas prices were down 18.3% year-over-year in May.
Energy prices fell 12.4% in May compared with the same month a year earlier, when “supply uncertainty surrounding Russia’s invasion of Ukraine led to energy prices rising substantially,” said Statistics Canada.
The biggest contributor to the year-over-year CPI increase was once again mortgage costs. The mortgage interest cost index rose 29.9%.
“The mortgage interest cost index rose 29.9% on a year-over-year basis in May following a 28.5% increase in April. For the third consecutive month, this was the largest increase on record, as Canadians continued to renew and initiate mortgages at higher interest rates.”
Grocery prices rose 9.0% year-over-year in May while the cost of cellular services dropped 8.2%, the largest year-over-year decline since April 2022.
For Statistics Canada’s full report, click here.
