News

Published June 25, 2024

Canada's annual inflation rate rose to 2.9 per cent in May, driven by services prices

By Canadian Press Staff
Inflation - CP
Tulips bloom as people make their way along Wellington Street and past the Bank of Canada in Ottawa on Monday, May 6, 2024. THE CANADIAN PRESS/Sean Kilpatrick

Canada's annual inflation rate rose to 2.9 per cent in May, largely driven by higher prices for services, Statistics Canada reported Tuesday.

The result was up from an annual inflation rate of 2.7 per cent in April. 

Statistics Canada said the overall increase for May came as prices for services rose 4.6 per cent from a year ago, up from a 4.2 per cent increase in April. Prices for goods grew at the same rate as April at one per cent.

The inflation report follows a decision by the Bank of Canada, which targets an annual inflation rate of two per cent, to cut its benchmark interest rate by a quarter of a percentage point earlier this month to 4.75 per cent.

The inflation reading, along with the upcoming June inflation data, are expected to play a key role in the central bank's next rate decision, set for July 24.

Barrie's News Delivered To Your Inbox

Stay up to date with what Barrie's talking about. Get the latest local news delivered right to your inbox every day. Never miss out on what's going on ...
Subscription Form
Consent Info

By submitting this form, you are consenting to receive marketing emails from: Central Ontario Broadcasting, 431 Huronia Rd, Barrie, Ontario, CA, https://www.cobroadcasting.com. You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email. Emails are serviced by Constant Contact

TD Bank senior economist James Orlando said one bad inflation report doesn't make a trend and inflation remained below three per cent, but it did speak to the unevenness of the path back to two per cent. 

"For this reason, we think the BoC will likely pause at its July meeting, before cutting rates again in September," Orlando wrote in report.

Mortgage interest costs were up 23.3 per cent compared with a year ago, while rent prices were up 8.9 per cent.

Prices in May for travel tours rose 6.9 per cent compared with a year ago while air transportation prices increased 4.5 per cent.

Gasoline prices were up 5.6 per cent compared with a year ago. 

Grocery prices rose 1.5 per cent year-over-year in May, a tick higher compared with April, when they rose 1.4 per cent. It's the first acceleration in grocery prices since June last year, however Statistics Canada said consumers are paying 22.5 per cent more for groceries compared with May 2020.

This report by The Canadian Press was first published June 25, 2024.

What do you think of this article?
+1
0
+1
0
+1
0
+1
0
+1
0
+1
2
Advertisement
Advertisement
Advertisement

Have a breaking story?

Share it with us!
Share Your Story

What Barrie's talking about!

From breaking news to the best slice of pizza in town! Get everything Barrie’s talking about delivered right to your inbox every day. Don’t worry, we won’t spam you. We promise :)
Subscription Form
Consent Info

By submitting this form, you are consenting to receive marketing emails from: Central Ontario Broadcasting, 431 Huronia Rd, Barrie, Ontario, CA, https://www.cobroadcasting.com. You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email. Emails are serviced by Constant Contact

Related Stories

Advertisement
Advertisement