Canada inflation rises to 2.4% in December as core measures ease again
Latest news on WhatsApp أجدد الأخبار على واتسابCanada's annual inflation rate accelerated to 2.4% in December, a rise Statistics Canada largely attributes to a "base-year effect." This statistical distortion stems from the temporary GST/HST holiday that was in effect from December 14, 2024, to February 15, 2025. The expiration of that tax relief period means current prices are being compared against artificially lower prices from a year ago, skewing the headline figure upward.
The Numbers Breakdown: On a monthly basis, the Consumer Price Index (CPI) actually declined by 0.2% in December. However, when seasonally adjusted, it posted a slight 0.3% increase.
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The Driver: Dining out became significantly more expensive, with restaurant food prices jumping 8.5% year-over-year (up from 3.3% in November), becoming the main contributor to the acceleration.
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The Offset: Gasoline prices provided some relief, dropping 13.8% year-over-year following a 7.8% drop in November. Excluding gasoline, the overall index rose by 3.0%.
Implications for Your Mortgage: Crucially for homeowners and borrowers, the Bank of Canada’s preferred measures of "core inflation" continued to cool for the third straight month. The CPI-median fell to 2.5% (from 2.8%), and the CPI-trim dropped to 2.7% (from 2.9%). Analysts view this steady decline in core pressure as a green light for the central bank to keep interest rates on hold in the near term, resisting the urge to hike despite the headline jump
