The Trudeau government’s GST holiday and Taylor Swift impacted inflation in December, as it continued to trend downward.
Statistics Canada said in its latest Consumer Price Index report inflation in December was 1.8 per cent, down from 1.9 per cent in November. Much of the continued deceleration was the cost of food from restaurants and alcohol.
Meals bought at restaurants dipped 1.6 year over year last month, while alcohol prices came down 1.3 per cent.
On a monthly basis, prices for booze dropped 4.1 per cent, almost triple the previous record for a monthly drop set in December 2005.
The Liberal government started its GST holiday on December 14, so the break on taxes will likely have a bigger impact in January. That measure ends on February 14.
Excluding food, inflation was 2.1 per cent in December.
The tax break also covered toys, games, hobby supplies, children’s clothing and shoes.
(Photo courtesy of Evgeniia Siiankovskaia / Royalty-free / iStock Getty Images Plus)
The cost of toys and games fell 7.2 per cent year-over-year, while children’s clothing dropped 10.6 per cent.
Shelter costs continued to rise, but inflation decelerated by 4.5 per cent from December 2023 after climbing 4.6 per cent in November. Rent fell 7.1 per cent compared to 7.7 per cent the month before, and mortgage interest costs also continued to decelerate, rising 11.7 per cent from a year ago.
December also marked the 16th consecutive month inflation for mortgage interest costs fell.
As for filling up the car, gas prices rose 3.5 per cent last month, following November’s 0.5 per cent drop. December’s increase is based on the so-called baseline effect. A year ago, gasoline prices jumped because of uncertainty in demand and high supply.
(Photo courtesy of OGULCAN AKSOY / Royalty-free / iStock Getty Images Plus)
The Eras Tour drove up travel accommodation prices. Statistics Canada credited upward pressure in British Columbia, where paying for a hotel room rose 56.7 per cent last month. Otherwise, those costs were up 13.7 per cent across Canada.
Travel tours cost 5.7 per cent more, while the broader category of travel services increased 7.9 per cent.
The next Consumer Price Index release is set for February 18 and will include inflation for January.
