Canadian Consumer Price Index Inches Higher in May

On Tuesday, Statistics Canada (StatCan) reported that the Canadian Consumer Price Index (CPI) increased 2.9% year-over-year in May, up from a 2.7% gain in April.

The increase in the headline CPI was largely due to higher prices for services, which rose about 4.6% in May, following an increase of 4.2% in April. The growth in services was led by increases in cellular services, travel tours, rent, and air transportation. Prices for goods increased 1.0%, the same rate as in April.

On a monthly basis, the CPI rose 0.6% in May, largely stemming from an increase in travel tours. On a seasonally adjusted monthly basis, the CPI rose 0.3%.

Prices for food purchased from stores rose 1.5% year-over-year in May, following a 1.4% increase in April. Although slight, this was the first acceleration since June 2023. Prices for groceries remain elevated and have increased by 22.5% compared with May 2020.

Month-over-month, grocery prices rose 1.1% in May. While this monthly increase is seasonally typical, it is the largest since January 2023. The increase was driven by higher prices for fresh vegetables, up 3.5%; meat, up 1.3%; fresh fruit, up 2.2%; and non-alcoholic beverages, up 2.4%.