Canada Inflation

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Canada: Inflation falls in January

February 26, 2015

In January, consumer prices fell a seasonally-adjusted 0.2% over the previous month, which matched December’s result. According to Statistics Canada, the decrease came on the back of lower prices for transportation.

Annual headline inflation fell from 1.5% in December to 1.0% in January, thus recording the lowest rate in over a year. According to Statistics Canada, the deceleration was due to lower gasoline prices. As a result, inflation is now at the lower bound of the Central Bank’s tolerance margin of plus/minus 1.0 percentage points around its target of 2.0%. Annual average inflation was stable at December’s 1.9% in January. Annual core inflation, which excludes volatile items such as gasoline and fresh food, was also stable at December’s 2.2%.

According to its January Monetary Policy Report, the Bank of Canada expects headline inflation to average 1.2% in 2015 and 2.0% in 2016. FocusEconomics Consensus Forecast panelists expect inflation to average 1.3% in 2015, which is down 0.5 percentage points from the previous month’s forecast. The panel expects inflation to average 2.1% in 2016.


Author: Angela Bouzanis, Senior Economist

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Canada Inflation Chart


Canada Inflation January 2015

Note: Year-on-year and month-on-month variation of seasonally adjusted consumer price index in %.
Source: Statistics Canada (SC).


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