Inflation is shrinking, but food prices remain high (The Canadian Press)

By The Canadian Press

Rate hikes added to inflation in June

Canada’s inflation rate tumbles to 2.8% in June even as grocery prices remain high

Jul 18, 2023 | 6:50 AM

OTTAWA – Statistics Canada says Canada’s inflation rate tumbled to 2.8 per cent in June, putting it within the Bank of Canada’s target range.

The federal agency says the deceleration was broad-based, though lower gasoline prices compared with last year led the slowdown.

But Canadians aren’t seeing any relief at grocery stores yet, as prices rose 9.1 per cent year-over-year, slightly faster than in May.

The Bank of Canada’s rate hikes are also feeding into higher inflation through mortgage interest costs.

The federal agency says that excluding mortgage interest costs, inflation would have risen two per cent year-over-year.

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The central bank raised interest rates earlier this month, in part because of concerns that inflation would stay high for longer.

(The Canadian Press)