Canada’s inflation rate rises to 2.8 per cent in April as gasoline prices climb

Canada’s annual inflation rate rose to 2.8 per cent in April, driven largely by higher gasoline prices, according to new data released by Statistics Canada. The increase marks the first time in nearly two years that the consumer price index (CPI) has reached that level.

Statistics Canada reported gasoline prices were up 28.6 per cent compared with the same month last year. Energy costs had also been a major factor in March, when the annual inflation rate reached 2.4 per cent.

Food inflation showed some easing during the same period. Grocery prices increased 3.5 per cent year over year in April, down from 4 per cent in March.

Economists say the higher inflation reading could add pressure on the Bank of Canada to consider additional interest rate increases in the coming months. The central bank’s inflation-control target remains between one and three per cent.

The Bank of Canada is scheduled to announce its next interest rate decision on June 10. Analysts are expected to watch closely for signals on the bank’s outlook for inflation and future monetary policy.