Statistics Canada’s consumer price index rose 1.7 per cent in May, the same as in April, as year-over-year increases in shelter costs dropped to three per cent, the slowest since the spring of 2021. The Bank of Canada’s two preferred measures of “core” inflation steadied, albeit at elevated levels. (The Logic) 

Talking point: Lower gasoline prices continued to push headline inflation below the Bank of Canada’s target of two per cent. Excluding energy, the index increased 2.7 per cent from May 2024, Statistics Canada said. The gauges the central bank uses to filter volatile price changes both increased three per cent on the year—less than the previous month, but still at the high end of the Bank of Canada’s comfort zone. The combination of increased supply of rental units and slower population growth in Ontario is taking the steam out of shelter inflation. The worry is that tariffs have sparked inflation anew. Governor Tiff Macklem said he will need assurance that price pressures are contained before he considers more interest rate cuts. There’s some evidence of that in this report, but maybe not enough.