Canada’s annual inflation rate rose to 2.8% in April as gasoline and broader energy prices jumped, even as food and rent inflation eased.
Canada’s annual inflation rate rose to 2.8 per cent in April, Statistics Canada reported Tuesday, with a sharp jump in gasoline and other energy costs driving the headline increase.
Energy prices were up 19.2 per cent from a year earlier, a steep acceleration from the 3.9 per cent annual increase recorded in March. Gasoline was the clearest pressure point: prices at the pump were 28.6 per cent higher year over year, reflecting both global supply strains and the seasonal shift to more expensive summer-blend fuel.
The April reading matters because it shows how quickly energy can reshape the overall inflation picture, even when other major household costs are rising more slowly. Statistics Canada said the closure of the Strait of Hormuz amid the U.S. and Israel’s war with Iran has pushed energy prices higher globally.
The agency also said Ottawa’s mid-month suspension of the federal fuel excise tax helped soften the monthly increase. But another federal policy change worked in the opposite direction in the annual comparison: the removal of the consumer carbon price a year earlier had lowered gasoline prices in April 2025, and that effect has now dropped out of the year-over-year calculation, making this April’s increase look larger.
Outside energy, the report was less heated. Rent continued to rise, but the pace slowed nationally to 3.6 per cent year over year from 4.2 per cent in March. Food inflation also eased, falling to 3.5 per cent from four per cent, as price growth cooled for items including chicken, fresh vegetables, coffee and tea.
Clothing and footwear prices rose two per cent in April after declining in March, while prices for tour travel fell 11 per cent after climbing the previous month.
Economists cited in the CBC report said the underlying inflation picture looked softer than the headline number suggested. BMO chief economist Doug Porter pointed to core measures that strip out volatile categories such as fuel and food, writing that, “Looking beyond the nasty business at the gasoline pumps, this report is unambiguously soft.”
CIBC senior economist Andrew Grantham noted that higher fuel costs may still appear in later inflation data through airfares, because those prices are counted when flights are taken rather than when tickets are bought. That means summer readings could show more of the spillover from April’s energy shock, even as softer core inflation may limit broader pressure elsewhere.
Comments (0)