In a surprising turn, Canada’s annual inflation rate eased to 2.8 per cent in February, according to Statistics Canada’s latest report released on Tuesday. This downturn was attributed to subdued growth in the costs of cellular services, groceries, and internet access services.
Contrary to economists’ projections of a potential rise in inflation, the data revealed a different trajectory, marking a departure from the 2.9 per cent rate recorded in January.
Rent and mortgage interest costs remained significant contributors to the inflation rate, as reported by the agency. Meanwhile, gas prices experienced a slight uptick of 0.8 per cent year-over-year in February, following a notable four per cent decline in January.
The report highlighted a noteworthy decline in cellular service costs, with Canadians benefiting from a substantial 26.5 per cent reduction compared to the same period last year. This reduction was attributed to lower prices for new plans and increased data allowances.
Additionally, the report noted a notable trend: for the first time in over two years, grocery prices saw slower growth compared to the headline inflation rate. This phenomenon, attributed to a base-year effect, does not negate the overall increase in food prices, with categories such as fresh fruit, processed meat, and fish witnessing declines despite the ongoing rise in grocery prices.