Inflation numbers come as energy prices surge
Canada's annual inflation rate increased to 2.8 per cent in April 2026, up from 2.4 per cent in March, driven largely by a sharp rebound in energy prices as the base-year effects of last year's carbon levy removal faded from the calculation, according to Statistics Canada data published Tuesday.
Notably, gasoline surged 28.6 per cent year over year, a dramatic jump from the 5.9 per cent gain recorded in March.
“Higher energy prices, most notably gasoline prices, drove the acceleration in the headline CPI. The removal of the consumer carbon levy in April 2025, which resulted in monthly declines for gasoline and natural gas, has now fallen out of the 12-month movement, putting upward pressure on the all-items CPI. Excluding gasoline, the CPI rose at a slower pace year over year in April compared with March,” the department said in its report.
Meanwhile, ongoing supply uncertainty tied to the Middle East conflict and the seasonal switch to costlier summer-blend fuel added further pressure, despite a temporary suspension of the federal fuel excise tax, effective April 20, offered only partial relief.
Fuel oil and other fuels climbed 41.3 per cent, and natural gas, while still declining, narrowed its drop to just 2.4 per cent from 18.1 per cent the prior month. Stripping out gasoline, the CPI decelerated to 2 per cent from 2.2 per cent in March.
Energy prices rose 19.2 per cent year over year last month, following a 3.9 per cent increase in March, according to StatsCan.
Elsewhere, clothing and footwear reversed course, rising 2.0 per cent in April after a 0.4 per cent decline in March. Women's clothing led the increase, while men's clothing fell less steeply than the month before.
Meanwhile, travel tour prices dropped 11.0 per cent year over year, a sharp swing from March's 11.5 per cent increase, reflecting typical seasonal softening in demand after the winter travel season.
Regionally, nine out of ten provinces saw faster price growth. Quebec notably posted the highest rate at 3.0 per cent, though its acceleration was modest given it was unaffected by last year's carbon levy removal due to its cap-and-trade system.
British Columbia was the lone holdout, with inflation steady at 2.5 per cent, largely thanks to cooling rent growth - down to 3.4 per cent from 6.4 per cent in March - as the province recorded its fourth consecutive quarter of population decline.
“At the national level, prices for rent rose at a slower pace year over year in April compared with March. Despite the slowdown, rent prices have increased 30.8 per cent from April 2021 to April 2026,” Statistics Canada said.
