Canada's inflation rate fell to 7.6% in July, the first month-on-month decline in 12 months, according to a report from Statistics Canada on Tuesday.
In June, inflation hit a 39-year high of 8.1%, with gasoline prices being the biggest contributor to overall gains.
By contrast, petrol prices fell month by month in July, according to the agency's Consumer Price Index. Consumer gas prices in July were 9.2% lower than in June, and the monthly decline he hasn't seen since April 2020.
Gasoline prices fell 12.2% monthly in Ontario. This is the largest in any state — after state governments implemented gas and fuel tax cuts on July 1.
``I had to sell my truck and buy a small car. It was like $1,200 a month just for gas.”
“It just didn't make sense for me to have [the truck] anymore. Wallets certainly didn't like it.."
The overall downward trend forecast by economists suggests that the sharply rising inflation is beginning to ease. . However, it is still far from the Bank of Canada's target of 2.2%.
View | When will inflation return to 'normal'? Canada's annual inflation rate eased slightly in July to 7.6%, although normal inflation of 2-3% It will still take about 18 months to get back on track, says personal finance writer Rubina Ahmed Haq.
Inflation rose 0.1% compared to June, but core her inflation rose, said consulting firm RSM Canada. economist Tu Nguyen said.
This means that "inflation is not just concentrated in a few categories such as gasoline and food, but spreads to all aspects of life," and by the time households sigh, added, "It will take some time." Reassuring.
“Wage growth continues to lag inflation and households are losing purchasing power.
Food rose at fastest pace since August 1981 1981
Grocery store prices rose 9.9% year-on-year, the fastest since August 1981, despite lower gasoline prices. became a pace.
Bakery products, non-alcoholic beverages, eggs and fresh fruit are among the items whose prices are accelerating. Baked goods, in particular, rose 13.6% as Russia's invasion of Ukraine contributed to soaring wheat prices.
Higher prices for services such as airline tickets (up 25.5%), natural gas (12.4%) and hotel stays (10.1%) were notable for strong month-to-month growth was a factor. - Increased months due to busy season.
Monthly rent is also rising, according to a StatsCan report. The rental market is expanding as high interest rates keep buyers who can't afford a mortgage away, with rental prices accelerating at a faster pace than in June.
Bank of Canada must continue to act: Economist
Desjardins economist Lois Mendez told CBC News, "The Bank of Canada must continue to act. I have to,” he said.
Last month, the Bank of Canada raised interest rates by one point to 2.5%. This is the latest in an ongoing aggressive campaign to curb runaway inflation.
View | Bank of Canada Issues Biggest Rate Hike in Nearly 25 Years:
Boost - It's Almost Largest in 25 years.
Further rate hikes are widely expected, but the question is whether banks will raise rates by 50 basis points or by 75 basis points. is.
Today's annual inflation rate is trending downward, but without further action it remains to be seen how much that figure will fall. As such, Mendez says he is wary of declaring that inflation has peaked.
"Inflation is still going on and it's not reflected in the official statistics. And when it comes to the global economy, what's going on, especially in Ukraine, what could happen this fall? There are still a lot of uncertainties,” he said. ''