21.10.202512:33:38UTC+00Canada Inflation Rate Rises to 7-Month High

In September 2025, Canada's annual inflation rate climbed to 2.4%, up from 1.9% the previous month, surpassing market predictions of 2.3% and reaching the highest point since February. This marked the first instance in six months where inflation exceeded the Bank of Canada's 2% benchmark. Factors related to base-year effects caused gasoline deflation to moderate to 4.1% from August's 12.7%, with reduced crude oil prices preventing a fuel price increase. As a result, annual transportation costs rose by 1.5%, reversing a 0.5% decline seen the month before. The Consumer Price Index (CPI) also quickened for food, with rates climbing to 3.8% from 3.4% in August, driven by a rise in grocery inflation (4% vs. 3.5%). This increase was attributed to higher vegetable prices (1.9% vs. -2%) and a significant jump in sugar and confectionery costs (9.2% vs. 5.8%). Additionally, inflation increased for household operations (2.4% vs. 2.1%) and the category encompassing recreation, education, and reading (1.6% vs. 0.5%). The average core inflation rate, which the Bank of Canada closely monitors, remained at a one-year high of 3.2%, defying forecasts of a 3% rate.