Inflation fell to 2.8 per cent in June as the cost at the gas pump decelerated.
It was 3.2 per cent in May.
The price of gas still rose 20.5 per cent, but that expense rose 33.2 per cent in May. Statistics Canada's Consumer Price Index Report said that while conflict continues in the Middle East, diplomatic talks and an interim ceasefire between the U.S. and Iran contributed to the 10.2 per cent month-over-month drop. It was the largest drop in gasoline inflation since April 2025.
Without gas, the inflation rate was 2.2 per cent.
Hosting the World Cup led to a 10.1 per cent increase in the cost of accommodations. Booking a hotel room or Airbnb jumped 19.4 per cent in Ontario, and 20 per cent in British Columbia. Toronto and Vancouver both hosted games.
The World Cup also boosted demand for domestic travel, so vehicle rentals increased 6.8 per cent, travel tours cost another seven-tenths of a percentage point, and air transportation increased 9.6 per cent because of higher travel demand and higher jet fuel costs.
Groceries continued to outpace headline inflation with prices rising 3.9 per cent year-over-year after May's 4.3 per cent increase. Statistics Canada says grocery prices outpaced overall inflation for the 17th straight month in June. The cost of fresh or frozen chicken rose 5.7 per cent, bread increased 6 per cent, and fresh fruit by 1.7 per cent.
Less demand for food bought in restaurants moderated inflation in Ontario to 2 per cent, the smallest increase in Canada.
Elsewhere in the G7 group of nations, the United States's inflation rate in June was 3.5 per cent, the highest of those nations. Italy's rate was 3 per cent, 2.3 per cent in Germany, while in France the rate was 1.8 per cent. Japan's inflation rate last month was 1.6 per cent, the lowest of the G7.
The United Kingdom releases its inflation rate on Tuesday.
