Increases in the Canadian Consumer Price Index Slow in January

On Tuesday, Statistics Canada (StatsCan) reported that the Canadian Consumer Price Index (CPI) increased 2.9% year-over-year in January, following a 3.4% gain in December.

The largest contributor to the headline deceleration in the CPI was lower year-over-year prices for gasoline, down 4.9%, compared with a 1.4% increase in December. Excluding gasoline, headline CPI slowed to a 3.2% year-over-year gain in January, down from 3.5% in December.

Also contributing to the downward pressure on the all-items CPI was the price of food purchased from stores, which advanced 3.4% in January—down from 4.7% in December. Lower prices for airfares and travel tours also provided relief to the headline CPI.

On a monthly basis, the CPI was unchanged in January, following a 0.3% decline in December. On a seasonally adjusted monthly basis, the CPI fell 0.1% in January—the first decline since May 2020.