Canada's annual inflation rate cooled to 1.8% in December, largely due to a temporary federal tax break on goods like restaurant meals, alcohol, and clothing. Without the tax holiday, inflation would have climbed to 2.3%. Grocery price growth also slowed, while gas prices remained high. Economists anticipate another interest rate cut by the Bank of Canada.
OTTAWA — Canada’s annual inflation rate fell to 1.8 per cent in December, thanks in large part to the federal government’s temporary tax break .
The federal government introduced a temporary pause on taxes to those items in mid-December, along with tobacco and cannabis products, clothing, and some toys, among others. Growth in grocery prices also decelerated from the prior month, falling to 1.9 per cent year-over-year, from 2.6 per cent in November. Gas price inflation remained elevated at 3.5 per cent year-over-year.
INFLATION TAX BREAK INTEREST RATES BANK OF CANADA ECONOMY
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