Canada’s inflation rate slows, but grocery prices and mortgage interest costs rise

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For the first time in a year, Canada’s inflation rate slowed to under six per cent last month, coming in at 5.9 per cent, according to Statistics Canada.

It follows a 6.3 per cent inflation rate in December, and falls below the 6.2 per cent that economists had predicted.


Despite the overall inflation rate dropping, grocery prices were up 11.4 per cent from last year.

“I look for sales now; I don’t buy as many luxury foods,” North Vancouver resident Sherrie King told CTV News outside a local grocery store Tuesday.

“I’m much more into sales now, whereas in the old days I didn’t have to do that,” she said.

Statistics Canada says the price of meat, which saw a 7.3 per cent bump, drove much of the uptick.

Meanwhile, the cost of bakery products was up 15.5 per cent, dairy products 12.4 per cent and fresh vegetables 14.7 per cent.

“A lot of that food, the veggies all of that stuff comes from the United States, so you’ve got connection problems here, transportation cost problems, all kinds of difficulties,” said Lindsay Meredith, professor of Economics and Marketing at Simon Fraser University.

“Will it come down? Yeah it will, but unfortunately were going to have to be patient,” he said.


The mortgage interest cost index shot up again, rising 21.2 per cent, the biggest jump since 1982, after an 18 per cent increase in December.

Vancouver-based realtor Kate MacPhail says, despite that, the market is starting to pick back up after a slow second half in 2022 as mortgage rates spiked.

She cited lowered listing prices and increased buyer confidence.

“There’s a greater probability that you will be able to get into the real estate market at prices that are lower than they were last spring,” MacPhail said. “I think for people this is an additional increase in confidence that there might not be another rate increase, if there is, it will likely be a slight increase, so prices might start to go up again, so I should get in now.”


While many have predicted a recession, Meredith doesn’t think we will get there.

“Are there guys looking for a major crash and burn here yet? Sure there are,” he said. “I’m not one of them, I suspect we’ll have a bumpy landing, but I think we’ll be OK.”

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