Canada's Inflation Accelerates to 3.0% in July as Gasoline and Travel Costs Surge
Canada's Consumer Price Index rose 3.0% year over year in July 2026, up from 2.8% in June, driven by sharply higher gasoline prices linked to Middle East disruptions and rising travel costs associated with World Cup hosting.
Canada’s annual inflation rate accelerated in July 2026, with the Consumer Price Index (CPI) rising 3.0% year over year, up from a 2.8% gain in June, according to Statistics Canada.
The increase was largely fueled by energy and travel-related expenses. Gasoline prices climbed 25.7% year over year in July, accelerating from a 20.5% increase in June. The upward pressure on fuel costs was influenced by the blockade of the Strait of Hormuz and the partial closure of Red Sea shipping routes.
Travel tour prices also surged, rising 15.2% year over year in July compared with 6.8% in June. Higher hotel and flight costs associated with World Cup matches contributed to the jump. Air transportation prices specifically increased 12.0% year over year, following a 9.6% rise in June, driven by higher jet fuel costs.
Excluding gasoline, the all-items CPI rose 2.2% year over year, marking the third consecutive month at that level.
Grocery price growth moderated but remained elevated. Food purchased from stores rose 3.1% year over year in July, slowing from 3.9% in June. This marked the 18th consecutive month that grocery inflation outpaced the headline all-items CPI. On a monthly basis, fresh fruit prices jumped 4.7% in July—the largest month-over-month movement for the month since 2011—driven by berries and melons.
Inflation varied significantly across provinces. Nova Scotia recorded the highest provincial rate at 5.0% in July, pushed higher by increases in electricity (+3.3%) and rent (+8.7%). Ontario posted the smallest increase among provinces, with its inflation rate remaining unchanged at 2.0%. That figure was held down by declines in homeowners' replacement cost (-4.6%) and natural gas prices (-18.7%).