Inflation expected to hit 3% in April as fuel costs spike
Statistics Canada releases April inflation data Tuesday. Economists forecast a jump to 3.1%, driven largely by rising gas prices tied to the Iran conflict.
Canada's inflation rate is expected to jump above 3 percent for the first time since 2023 when Statistics Canada releases April consumer price data on Tuesday, marking a significant reversal after months of declining price pressures.
A Reuters poll of economists points to a headline inflation rate of 3.1 percent in April, up sharply from 2.4 percent in March. The culprit is simple but consequential: gas prices. Analysts at Royal Bank and elsewhere are pinpointing the energy shock rippling through global markets—tensions in the Middle East have disrupted oil supplies and pushed fuel costs higher.
For Montreal households already stretched by housing costs and grocery bills, this matters. When gas climbs, shipping costs rise, food prices creep up, and the cumulative effect is felt at the pump and in your wallet every time you fill up or buy anything transported by truck. Inflation above 3 percent also complicates the Bank of Canada's interest rate calculus; if price growth re-accelerates, the central bank may hesitate to cut rates further, which affects mortgage rates and borrowing costs.
The full picture will emerge Tuesday when Statistics Canada publishes the actual April CPI data. For now, economists and households alike are bracing for a number that confirms what energy markets have been signaling for weeks.