Analysis

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The Consumer Price Index (CPI) rose 1.5% in the 12 months to June, matching the gain in May.

Excluding gasoline, the CPI was up 1.9% year over year in June, matching the increase in May.

12-month change in the major components

Prices rose in all major components in the 12 months to June, with the shelter index and the household operations, furnishings and equipment index contributing the most to the year-over-year gain in consumer prices.

The shelter index rose 1.6% in the 12 months to June, after increasing 1.4% in May. This acceleration was partly attributable to the homeowners’ replacement cost index, which was up more year over year in June (+3.5%) than May (+2.7%). Additionally, fuel oil prices were down less on a year-over-year basis in June (-13.2%) compared with May (-17.3%). The index for natural gas posted a larger decline in the 12 months to June than in the previous month.

Food prices were up 1.3% year over year in June, following a 1.8% gain in May. Prices for food purchased from stores rose 0.8% in the 12 months to June, as the fresh or frozen beef index (-3.3%) registered its first year-over-year decline since August 2010. Consumers paid 2.1% less for dairy products in June compared with the same month a year earlier. Prices for food purchased from restaurants advanced 2.6% on a year-over-year basis in June, matching the rise in May.

The transportation index posted a 1.1% year-over-year gain in June, the same increase as in May. The purchase of passenger vehicles index rose 5.6% in the 12 months to June, following a 4.3% advance the previous month. This acceleration was partly offset by a larger year-over-year decrease in gasoline prices, down 8.5% in June compared with a 7.1% decline the previous month. The passenger vehicle insurance premiums index was up less year over year in June (+0.2%) than May (+1.2%); the deceleration was led by Ontario, where regulatory changes to coverage took effect on June 1, 2016.

12-month change in the provinces

In six provinces, consumer prices rose more year over year in June than in May, with Newfoundland and Labrador registering the largest acceleration. In Prince Edward Island, Quebec, Ontario and Alberta, the CPI was up less year over year in June than in the previous month.

The CPI in Newfoundland and Labrador rose 2.4% year over year in June, following a 1.5% gain in May. This acceleration was mostly attributable to the gasoline index, which increased 2.9% in the 12 months to June, following a 10.0% year over year drop the previous month. On a monthly basis, gasoline prices were up 19.5% in June, mainly because of an increase in the province’s gasoline tax that took effect on June 2, 2016. On a year-over-year basis, the fuel oil index was down 1.8% in June, after posting an 11.4% decrease the previous month.

In Quebec, consumer prices increased 0.6% in the 12 months to June, the smallest year-over-year gain since February 2014. The gasoline index and the dairy products index posted larger year-over-year declines in June than in the previous month. The fresh fruit index was up less year over year in June (+2.0%) than in May (+8.2%).

On a year-over-year basis, Manitoba’s CPI was up 2.1% in June, after increasing 1.7% in May. After declining 3.6% year over year the previous month, gasoline prices were up 3.5% in the 12 months to June, partly as a result of a supply disruption stemming from refinery outages that affected the Western provinces. The meat index decreased 3.0% year over year in June, a larger decline than at the national level.

Seasonally adjusted monthly Consumer Price Index increases

On a seasonally adjusted monthly basis, the CPI increased 0.2% in June, matching the gain in May.

In June, five of the eight major components increased on a seasonally adjusted monthly basis. The food index and the alcoholic beverages and tobacco products index decreased, while the recreation, education and reading index posted no change.

On a seasonally adjusted monthly basis, the transportation index (+0.9%) recorded the largest gain in June, while the food index (-0.3%) registered the largest decline.

Non-seasonally adjusted monthly Consumer Price Index increases

On a monthly basis and before seasonal adjustment, the CPI rose 0.2% in June, following a 0.4% gain in May.

Consumer prices were up in nine provinces, with Quebec (-0.2%) being the sole province to register a decline on a monthly basis and before seasonal adjustment. The CPI in Newfoundland and Labrador (+1.1%) recorded the largest gain on a non-seasonally adjusted monthly basis.

Bank of Canada’s core index

The Bank of Canada’s core index increased 2.1% in the 12 months to June, matching the rise in May.

On a monthly basis and before seasonal adjustment, the core index posted no change in June, after a 0.3% gain in May.

The seasonally adjusted core index rose 0.2% on a monthly basis in June, equal to the gain in May.