Inflation cools in July due to lower gas prices, StatCan reports

Statistics Canada is reporting that inflation was down in July largely due to gas prices.

Inflation cooled from June’s 1.9 per cent to 1.7 per cent for July.

StatCan says gas prices were down 16.1 per cent year-over-year in July due to the removal of the consumer carbon price.

When gas prices were compared monthly, they showed a declining cost of 0.7 per cent.

This follows the increase of production from oil-exporting countries and the ceasefire agreement between Israel and Iran.

READ MORE: Employment rate fell slightly in July, says StatCan

There were also signs that pressure is building and costs were increasing on grocery bills in July.

Grocery costs rose 3.4 per cent annually, which is up from June’s 2.8 per cent.

StatCan says the largest increase came in confectionary and coffee prices. This industry is impacted by tough growing conditions in countries where cacao and coffee beans are grown.

Shelter inflation was also up in July, marking the first increase in the category since February 2024. This is due to rents in Prince Edward Island, Newfoundland and Labrador and British Columbia increasing despite mortgage costs remaining low.

The Bank of Canada will consider these figures when presenting its next interest rate decision on Sept. 17.

Ontario Premier Doug Ford took the opportunity to reiterate his call for the Bank of Canada to cut interest rates.

With inflation rates falling and President Trump’s tariffs taking direct aim at Canadian workers, we need the Bank of Canada to cut interest rates now so we can keep our economy growing and keep workers on the job. https://t.co/ynpJ2kH1kO

— Doug Ford (@fordnation) August 19, 2025

READ MORE: Bank of Canada holds key rate at 2.75% for third time amid tariff uncertainty