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Consumer Price Index, July 2018

Released: 2018-08-17

Consumer Price Index

July 2018

3.0% increase

(12-month change)

The Consumer Price Index (CPI) rose 3.0% on a year-over-year basis in July, following a 2.5% increase in June. While continued strength in energy prices contributed most to the year-over-year increase, higher prices for various services, including air transportation and travel tours, also contributed to consumer price growth in July.

The Bank of Canada's preferred measures of core inflation remained stable in July.

Chart 1  Chart 1: The 12-month change in the Consumer Price Index (CPI) and the goods index
The 12-month change in the Consumer Price Index (CPI) and the goods index

Component highlights

All eight major components rose year over year in July. The transportation index (+8.1%) was the largest contributor to the year-over-year increase.

Chart 2  Chart 2: Consumer prices increase in all major components
Consumer prices increase in all major components

Energy costs were 14.2% higher compared with July 2017, after increasing 12.4% year over year in June. Consumer prices for gasoline (+25.4%) and fuel oil and other fuels (+28.1%) continued to increase on a year-over-year basis, amid rising global prices for crude oil following recent supply disruptions.

Consumer prices for transportation rose 8.1% in July, following a 6.6% increase in June. In addition to gasoline, the purchase of passenger vehicles index rose more on a year-over-year basis in July (+2.0%) than it did in June (+1.8%). Prices for passenger vehicle insurance premiums were 3.5% higher compared with July 2017, following rate increases in several provinces.

Year-over-year gains in the price of services were higher in July (+3.2%) than in June (+2.2%). Month-over-month increases in the air transportation index (+16.4%) and the travel tours index (+13.9%) reflected higher prices during peak travel season. Prices for telephone services increased 2.2% on a month-over-month basis following declines in May and June, when a series of industry-wide price promotions took place. Recent interest rate increases continued to impact the mortgage interest cost index, which rose 5.2% in the 12 months to July.

Regional highlights

In all provinces, prices rose more in July on a year-over-year basis compared with the previous month.

Chart 3  Chart 3: Consumer prices rise at a faster rate in all provinces
Consumer prices rise at a faster rate in all provinces

In Ontario, prices for electricity rose 0.3% on a year-over-year basis, after declining 10.9% in June. Price declines from the Ontario Fair Hydro Plan Act, which significantly lowered consumer electricity costs in July 2017, no longer affected the 12-month movement for electricity in Ontario, leading to the first year-over-year increase in the province since December 2016.

At the national level, consumers paid less for traveller accommodation (-4.1%) compared with July 2017, when a significant increase in prices coincided with celebrations related to Canada's 150th birthday. The year-over-year declines were most pronounced in Eastern Canada.

Seasonally adjusted monthly Consumer Price Index

On a seasonally adjusted monthly basis, the CPI rose 0.5% in July, following a 0.2% increase in June. Six of eight major components increased, while the clothing and footwear index (-0.4%) declined and the health and personal care index was unchanged.

Chart 4  Chart 4: Seasonally adjusted monthly Consumer Price Index
Seasonally adjusted monthly Consumer Price Index






  Note to readers

Real-time data tables

Real-time data table 18-10-0259-01 will be updated on September 4.

Next release

The Consumer Price Index (CPI) for August will be released on September 21.

Air transportation index

Users are reminded that the methodology for the air transportation index was updated in March 2018 as part of the regular review of the CPI methodology. Interpretation of the 12-month price change indicator should be made with caution, particularly in the year following the implementation of the new methodology.

Products

More information about the concepts and use of the Consumer Price Index (CPI) is available in The Canadian Consumer Price Index Reference Paper (Catalogue number62-553-X).

For information on the history of the CPI in Canada, consult the publication Exploring the First Century of Canada's Consumer Price Index (Catalogue number62-604-X).

Two videos, "An Overview of Canada's Consumer Price Index (CPI)" and "The Consumer Price Index and Your Experience of Price Change," are available on Statistics Canada's YouTube channel.

Contact information

For more information, or to enquire about the concepts, methods or data quality of this release, contact us (toll-free 1-800-263-1136; 514-283-8300; STATCAN.infostats-infostats.STATCAN@canada.ca) or Media Relations (613-951-4636; STATCAN.mediahotline-ligneinfomedias.STATCAN@canada.ca).

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