Canada’s inflation rate slowed to 2.8 per cent in June as falling gasoline prices gave consumers a break at the pumps.

On a monthly basis, gas prices dropped by 10.2 per cent, the largest monthly decline since April 2025, as an interim ceasefire agreement between the United States and Iran resulted in a drop in global oil prices.

Gasoline prices were still up 20.5 per cent compared to the same month last year, but rose more slowly than the 33.2 per cent jump registered in May.

Grocery prices also decelerated year-over-year in June, rising by about 3.9 per cent compared with 4.3 per cent in May. The deceleration was driven by slower price growth in fresh fruit, mainly due to cheaper prices for grapes. However, higher prices for chicken, bread and frozen foods offset part of the slowdown.

Despite the deceleration, June marked the 17th consecutive month where grocery price inflation outpaced headline inflation.

Other indices also contributed to the deceleration in headline inflation, including a slowdown in prices for passenger vehicles.

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However, prices for travel-related services accelerated after the FIFA World Cup kicked off. Traveller accommodation accelerated by 10.1 per cent year-over-year in June compared with a 2.5 per cent increase in May, driven by higher prices in Toronto and Vancouver as demand rose in host cities.

Core inflation measures remained relatively stable, with trim and median hovering at just under two per cent on a yearly basis in June.

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