Canada’s headline inflation rate held steady at 3.0% in August 2026, matching market expectations and remaining below the post–Iran war peak of 3.2%. Price growth continued to be driven primarily by energy products, as the conflict in the Middle East disrupted a key source of global oil supply. Gasoline prices were up 22.8% year over year, easing slightly from the 25.7% increase recorded in July.
In contrast, grocery prices rose 2.8% in August, down from 3.1% in July, slipping below the headline inflation rate for the first time in more than two years. Core inflation measures monitored by the Bank of Canada stayed close to target: the trimmed-mean core rate and the median core rate were unchanged at 1.9% and 2.0%, respectively, in line with expectations. On a month-over-month basis, the Canadian CPI edged down 0.1%.
