Main PageJune 22, 2026

Canada May CPI +3.2% y/y vs +3.0% expected

  • Prior was +2.8% y/y
  • CPI +1.0% m/m vs +0.8% expected
  • Prior m/m was +0.4%

Core measures:

  • BOC core +2.2 vs +2.1 prior
  • BOC core m/m +0.2% vs +0.2% prior
  • Core CPI SA +0.2% m/m +0.3% vs prior
  • CPI median 2.1% vs 2.1% expected (prior was 2.1%)
  • CPI trim 2.0% vs 2.0% expected (prior was 2.3%)
  • CPI common 2.7% vs 2.5% prior

Gasoline was the main driver of higher inflation but even excluding gasoline, prices rose 2.2% y/y in the month compared with 2.0% in April. Gasoline itself was up 33.2% y/y in May compared to +28.6% in April but that has now gone into reverse so the June reading will cool.

We are also seeing the second-order effects of higher oil prices as air transport rose 7.4% y/y in May compared to -1.7% y/y prior. In monthly terms, prices rose 6.7%.

The main drag on Canadian CPI continues to be housing with the homeowners’ replacement cost down 2.5% y/y and 0.3% m/m.

For background, Canada’s headline Consumer Price Index rose 2.8% year over year in April, up from an increase of 2.4% in March. On a seasonally adjusted monthly basis, the CPI rose 0.3% in April, with the unadjusted monthly gain at 0.4%. The April reading was the highest in two years and came in below the market consensus near 3.1%. Statistics Canada released the figures on May 19, 2026.

Energy was the dominant contributor. Gasoline surged 28.6% year over year, a sharp jump from the 5.9% gain recorded in March. Energy prices as a whole were 19.2% higher versus a year ago, the fastest pace since 2022. Drivers cited included the fading base-year effect from the April 2025 removal of the consumer carbon levy, supply uncertainty tied to the Middle East conflict, and the seasonal switch to summer-blend fuel. The temporary suspension of the federal fuel excise tax that took effect on April 20 moderated the increase. Prices for fuel oil and other fuels rose 41.3% year over year in April.

Elsewhere, food inflation eased to 3.5% in April, down from 4% in March. Rent rose at a slower pace year over year in April (+3.6%) compared with March (+4.2%). The Bank of Canada’s core inflation metrics, median and trim, averaged 2.1% year over year in April, down from 2.3% in March, with trim at 2.0% and median at 2.1%. Inflation excluding gasoline was up a more modest 2.0% year over year.

This article was written by Adam Button at investinglive.com.