Consumer Price Index, August 2019

Released: 2019-09-18

The Consumer Price Index (CPI) rose 1.9% on a year-over-year basis in August, down from a 2.0% increase in July, primarily due to lower gasoline prices. Excluding gasoline, the CPI rose 2.4%, matching the increase in July.

The CPI has grown by 1.9% or more on a year-over-year basis for six consecutive months, after reaching a low of 1.4% in January of this year. The broad-based gains in the CPI over the past two quarters have coincided with strength in Canadian labour market conditions.

On a seasonally adjusted monthly basis, the CPI was unchanged in August following a 0.4% increase in July.

Chart 1 
The 12-month change in the Consumer Price Index (CPI) and CPI excluding gasoline

Chart 2 
Prices for energy decline year over year

Highlights

Consumers pay less for gasoline, while natural gas prices rise

Consumer prices for gasoline fell 10.2% in the 12 months to August, following a 6.9% decline in July. Global oil prices fell slightly in August due to higher production and soft international demand, remaining below the elevated levels of 2018.

In contrast, natural gas prices rose 5.8% year over year in August, up from a 3.2% increase in July. This was attributable to a bounce back in prices from earlier this summer, when gas pipeline maintenance was ongoing and inventories were higher.

Chart 3 
Gas prices decrease at a faster pace year-over-year in nine provinces

Air fares increase on jet groundings and summer travel

Air transportation prices rose 10.3% year over year in August after increasing 4.6% in July. The increase was largely related to continued reductions in operational aircraft capacity during the final month of the busy summer travel season, due to the March grounding of the Boeing 737 MAX aircraft models.

Chart 4 
Air transportation prices continue to reach summer highs

Cheaper vegetables and meat for consumers

Canadians paid 6.5% less for fresh vegetables in August compared with July, marking the largest month-over-month decline in five years. This led to slower year-over-year growth in the fresh vegetables index as transitory pressures stemming from inclement weather in agricultural regions, which boosted the index in May, June and July, eased. The fresh fruit index (-1.0%) declined on a year-over-year basis for the second consecutive month.

Chart 5 
Slowdown in fresh fruit and fresh vegetables prices

The cost of meat grew 4.8% on a year-over-year basis in August, after rising 5.5% in July. The slowdown was partially attributable to a 2.7% month-over-month decline in the fresh or frozen pork index, coinciding with increased domestic supply owing to foreign restrictions on Canadian pork exports.

Chart 6 
Consumer prices rise at a slower or unchanged pace in eight provinces

Regional highlights

The homeowners' replacement cost index, which tracks the price of new homes, declined in five provinces. The index fell year over year in Saskatchewan (-3.4%) and Alberta (-3.3%), continuing the downward trend since the beginning of 2018. It also fell in Ontario (-0.4%), driven by the largest month-over-month decline in the province since 2009.

Canadians pay less for hotels, except in New Brunswick

The cost of traveller accommodation (-6.7%) fell on a year-over-year basis for the 14th consecutive month. The decrease was widespread, as the index fell in all but one province. New Brunswick was the lone province to report higher year-over-year prices for traveller accommodation, which was attributable, in part, to higher demand related to a festival held in the region in August.

Products

The interactive Consumer Price Index Data Visualization Tool is available on the Statistics Canada website.

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).