Canada’s annual inflation rate fell to 4.3 per cent in March.
Higher mortgage interest costs were offset by lower energy prices, reinforcing expectations that it would continue to fall at a consistent pace in 2023.
Statistics Canada reported in its consumer price index released this week that inflation eased last month.
The headline rate slowed from 5.2 per cent in February, continuing along a downward trend that some analysts expect could go as low as three per cent by the middle of the year.
This easing comes as high interest rates still weighs on the economy and as global price pressures cool off.
The continued slowdown in inflation since last summer has now brought the annual rate down to the lowest it’s been since August 2021.
Its preferred measures of core inflation, which the Bank of Canada uses to look through volatility in prices, also trended downward in last month.
But the central bank has stated that it will continue to make efforts to bring inflation back to its two per cent target.
However, homeowners aren’t seeing much relief. Those with new mortgages or renewing their mortgages are seeing high interest rates. Last month, mortgage interest costs rose at the fastest pace on record, up 26.4 per cent from last year.
Grocery prices also continue to rise rapidly. Prices were up 9.7 per cent on a year-over-year basis in March, down from 10.6 per cent in February. StatsCan stated that this was driven by lower prices for fruits and vegetables.