Canadian Inflation Cools to 1.7%, Core Measures Stay Elevated

Canada’s consumer-price inflation slowed to 1.7% in July from 1.9% a month earlier, undershooting economists’ 1.8% consensus, according to data published by Statistics Canada on Tuesday. On a month-over-month basis, the headline index rose 0.3%, matching forecasts and up from 0.1% in June. Underlying price pressures showed only modest improvement. The Bank of Canada’s preferred median and trimmed-mean core measures held at 3.1% and 3.0%, respectively, while the bank’s overall core gauge eased to 2.6% from 2.7%. All three readings remain above the central bank’s 2% target, suggesting persistent pockets of inflation despite the headline slowdown. StatCan said lower gasoline costs—down 16.1% from a year earlier—were the main driver of the deceleration, offsetting quicker increases in grocery prices and rents. Excluding fuel, annual inflation stood at 2.5% for a third consecutive month.