OTTAWA – Canada’s inflation rate was 1.5 per cent in May as a drop in fuel prices from a year earlier provided an offset to increases in other consumer goods, Statistics Canada said Friday.
The federal agency’s May inflation reading followed a 1.7 per cent year-over-year increase in April.
Higher prices for purchases such as electricity, passenger vehicles and home insurance were offset by cheaper gasoline, fuel oil and natural gas.
Gasoline prices were down 7.1 per cent last month compared with May 2015 and, excluding gasoline, last month’s inflation rate was 1.9 per cent — almost equal to the Bank of Canada’s ideal target of two per cent.
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Food prices saw their smallest year-over-year gain last month since March 2014. The increase in prices of fresh vegetables and fruits saw considerable deceleration.
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The price tag on apples, however, climbed 17.8 per cent last month compared to the year before. Over the same period, alcohol and tobacco products were up 3.2 per cent.
The annual core inflation rate, which excludes some volatile items such as pump prices and some food, was 2.1 per cent last month after a 2.2 per cent reading in April.
Inflation was lower in eight provinces in May compared to the previous month. Only Manitoba saw a higher rate while Alberta’s inflation rate was unchanged.
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