A rise in prices for durable goods is partly to blame for an increase in Canada's inflation rate for June.
Statistics Canada's Consumer Price Index (CPI) for June was released on Tuesday morning, and it showed that inflation increased by two-tenths of a percentage point, to 1.9 percent.
Month to month, the CPI rose a tenth of a percentage point in June. On a seasonally adjusted monthly basis, the CPI increased by 0.2 per cent.
Prices for durable goods, such as automobiles, went up at a faster pace in June, by 2.7 per cent. The increase in May was two per cent.
Specifically, the price of new passenger vehicles was up 5.2 per cent, compared to May's 4.9 per cent rise.
Prices for clothes and shoes also went up in June. The CPI reported that they went up two per cent, compared to 0.5 per cent in May. The women's clothing index was unchanged in June, compared to a 2.5 per cent decline in May. Uncertainty over trade issues with the U.S. and tariffs helped put pressure on those prices.
The good news is that consumers have not been paying more to fill up their vehicles with the summer holiday season in full swing. Gas prices dropped by 13.4 per cent in June compared to 2024, though the decrease was smaller than in May, when it was 15.5 per cent.
Year over year, the CPI, with energy out of the equation, was up at 2.7 per cent, higher than the CPI in June in part because of the removal of the carbon tax in April.
It also hasn't been costing as much at the grocery store. The CPI reported a 2.8 per cent increase in food prices in June, less than the 3.3 per cent hike in May. The slower increase was fueled by a decline in fresh vegetable prices.
The inflation report for July is scheduled to be released on August 19.