The Consumer Price Index (CPI) rose 1.8% on a year-over-year basis in December, down from a 1.9% increase in November. Food purchased from restaurants and alcoholic beverages purchased from stores contributed the most to the deceleration. The CPI excluding food rose 2.1% in December, reported Statistics Canada on Tuesday.
A temporary GST/HST break on certain goods was introduced on December 14, 2024. The major components impacted by the tax break were food; alcoholic beverages, tobacco products, and recreational cannabis; recreation, education, and reading; and clothing and footwear, said the federal agency.
On a monthly basis, the CPI declined 0.4% in December, following a flat month in November. On a seasonally adjusted monthly basis, the CPI rose 0.2%, it said.
“Canadians paid less for food purchased from restaurants in December (-1.6%) on a year-over-year basis. This was the index’s first annual decline, paired with its largest monthly decline (-4.5%) amid the GST/HST break,” explained StatsCan.
“On a year-over-year basis, prices for alcoholic beverages purchased from stores declined 1.3% in December, compared with a 1.9% increase in November. On a monthly basis, prices fell 4.1%, almost tripling what had previously been the largest monthly decline recorded for the series in December 2005 (-1.4%).
“Prices for toys, games (excluding video games) and hobby supplies decreased 7.2% year over year in December 2024, down from a 0.6% decline in November. In addition, the children’s clothing index fell 10.6% in December compared with the same month in 2023.”
Year over year, Statistics Canada said prices for gasoline rose 3.5% in December compared with a 0.5% decline in November. The increase was mainly the result of a base-year effect as prices declined 4.4% month over month in December 2023, when there was uncertainty regarding oil demand coupled with high levels of supply, which put downward pressure on prices.
On a monthly basis, gasoline prices fell 0.6% in December 2024, added the report.
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