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Consumer Price Index, June 2020

Released: 2020-07-22

Consumer Price Index

June 2020

0.7% increase

(12-month change)

The Consumer Price Index (CPI) rose 0.7% on a year-over-year basis in June, up from a 0.4% decline in May. Excluding gasoline, the CPI rose 1.2%.

On a seasonally adjusted monthly basis, the CPI increased 1.0% in June. Excluding food and energy, the seasonally adjusted CPI rose 0.2%.

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

Infographic 1  Thumbnail for Infographic 1: The Consumer Price Index rises at the fastest pace since March 2011
The Consumer Price Index rises at the fastest pace since March 2011

Highlights

The year-over-year increase in the CPI for June rose at the fastest pace since March 2011.

Prices rose in five of the eight major components on a year-over-year basis. Food and shelter prices contributed the most to the increase in the CPI. Prices for goods declined by less than the previous month on a year-over-year basis, including energy prices.

Chart 2  Chart 2: Prices rise in five of eight major components
Prices rise in five of eight major components

Year over year, prices for services (+1.3%) rose by the same amount in June as in May. Prices for goods (-0.2%), however, declined at a slower pace than in May (-2.3%), contributing significantly to the return to positive growth in the CPI. While the CPI grew at a faster pace primarily as a result of energy prices, prices for durable and semi-durable goods, such as passenger vehicles, clothing and footwear, also contributed.

Chart 3  Chart 3: Price of goods decline at a slower rate
Price of goods decline at a slower rate

Upward pressure on gasoline prices

Gasoline prices declined less, on a year-over-year basis, in June (-15.7%) than in May (-29.8%). Following large price declines in March and April due to the COVID-19 pandemic, gasoline prices declined at a slower pace for the second consecutive month, mainly as a result of higher demand coinciding with the gradual reopening of businesses and public services, as well as a general increase in local travel in June. Higher prices for crude oil also contributed to this slowing decline, as economies around the world continued to reopen.

Higher prices for beef and lower prices for chicken

Meat prices rose 8.1% year over year in June, with beef prices leading the way. Consumers paid 8.3% more for fresh or frozen beef compared with May, the largest monthly increase since May 1982. This followed the COVID-19-related closure of several large beef processing plants and the reduction in operating capacity at other plants, in both April and May.

Fresh or frozen chicken prices fell 4.4% month over month, the largest monthly decline since November 2004. This was mainly attributable to low wholesale chicken prices and an increase in flyer sales.

Chart 4  Chart 4: Beef and pork prices rise while chicken prices fall
Beef and pork prices rise while chicken prices fall

Clothing and footwear prices rise amid reopening

Following two consecutive months of decline, the clothing and footwear index rose 1.0% in June compared with May, when retail clothing outlets remained largely closed to in-person shopping. While many provinces allowed the reopening of retail outlets and shopping malls towards the end of May, Ontario and Quebec allowed the reopening of retail in early June outside major cities and later in June within major cities.

Rents increase, while mortgage interest costs fall

Rents rebounded in June, rising 0.6% on a monthly basis following a 0.8% decline in May. This coincided with the easing of some restrictions related to the COVID-19 pandemic, as well as the start of the warmer summer months.

Following a monthly decline in May, the first since July 2017, the mortgage interest cost index fell 0.3% month over month as mortgage rates continued to fall in part due to declining bond yields, as well as reductions in the Bank of Canada's policy interest rate in March.

Chart 5  Chart 5: Mortgage interest cost index declines month over month
Mortgage interest cost index declines month over month

Regional highlights

Prices rose in nine provinces on a year-over-year basis in June. Prices rose the most in Alberta, where natural gas prices increased 43.9%, following a significant price decline in June 2019, when commodity prices fell and the provincial carbon tax was removed.

Year-over-year price growth was weakest among the Atlantic provinces, where furnace fuel oil is more commonly used. Prices for furnace fuel are subject to the same oil price dynamics as gasoline, and remained low compared with June 2019.

Chart 6  Chart 6: The Consumer Price Index increases in nine provinces
The Consumer Price Index increases in nine provinces

Higher electricity prices in Ontario

Prices for electricity rose 17.2% in Ontario on a month-over-month basis, the largest monthly increase since May 2003. The provincial government introduced higher electricity prices on June 1, after significantly lowering prices in March in response to the COVID-19 pandemic.

Two ways of exploring the Consumer Price Index (CPI)

Visit the Consumer Price Index portal to find all CPI data, publications, interactive tools, and announcements highlighting new products and upcoming changes to the CPI in one convenient location.

Check out the Consumer Price Index Data Visualization Tool to access current and historical CPI data in a customizable visual format.

Additional research related to COVID-19

For more information about the impact of COVID-19 on the CPI, please consult the research document entitled "Consumer expenditures during COVID-19: An exploratory analysis of the effects of changing consumption patterns on consumer price indexes," released on July 13, which explores new sources of expenditure data to estimate basket weights that reflect shifting consumption patterns during the pandemic.

For more information on consumer expenditures during COVID-19, users can consult two available documents. The first is "Canadian Consumers Prepare for COVID-19," released on April 8, which examines the shifting consumption patterns of Canadians during the COVID-19 pandemic up to March 14. The second is "Canadian Consumers Adapt to COVID-19: A Look at Canadian Grocery Sales up to April 11," released on May 11, which explores a continued shift in the consumption patterns of Canadians during the COVID-19 pandemic up to April 11.

All of the above publications can be found in the Prices Analytical Series (Catalogue number62F0014M).






  Note to readers

COVID-19 and the Consumer Price Index

Statistics Canada continues to monitor the impacts of the novel coronavirus (also known as COVID-19) on Canada's Consumer Price Index (CPI).

In June, measures remained in place across much of the country to restrict the movement of people and order the temporary closure of businesses. Subsequently, in-person field collection was conducted via telephone or Internet, supplementing prices collected via web scraping, transaction data and administrative data. Due to the impact of COVID-19 on product availability in the month of June 2020, select sub-components of the CPI received temporary special imputations.

While some products and services, such as personal care services, started to become available for consumption in June, others, such as spectator entertainment and travel tours, remained unavailable. Availability of goods and services varied throughout the country, as different provinces reopened their economies to various extents at different times. The following sub-indexes were imputed from the monthly change in the all-items index: travel tours; spectator entertainment; and use of recreational facilities. These imputations have the effect of removing the impact of these goods and services from the CPI.

Consistent with previous months of the COVID-19 pandemic, prices for suspended flights are excluded from the June CPI calculation because passengers were ultimately unable to consume these services. As a result, select sub-components of the air transportation index were imputed from the parent index.

The price indexes for beer served in licensed establishments, wine served in licensed establishments and liquor served in licensed establishments were imputed in regions where the restrictions remained in place, using the indexes to which consumers likely redirected their expenditures: beer purchased from stores, wine purchased from stores, and liquor purchased from stores.

Where prices were missing due to high levels of out-of-stock products or the temporary closure of businesses, they were imputed with the average price movement of available prices for those items.

As in April and May, selected sub-components of the CPI received temporary special imputations because of the impact of COVID-19 on product availability. A document entitled Technical Supplement for the June 2020 Consumer Price Index is available in the Prices Analytical Series (Catalogue number62F0014M) publication, with further details on the imputations used to compile the June 2020 CPI.

Cellular services index

The cellular services index is available upon request. For more information, contact us (toll-free 1-800-263-1136; 514-283-8300; STATCAN.infostats-infostats.STATCAN@canada.ca).

Real-time data tables

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

Next release

The Consumer Price Index for July will be released on August 19.

Products

The 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).

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