Gasoline at the wheel
Fuel costs were again the dominant force behind May’s acceleration. Gasoline prices rose 33.2% year over year in May, up from a 28.6% gain in April, as continued closure of the Strait of Hormuz kept global oil supply constrained for a third consecutive month.
Statistics Canada noted that Canadians paid the highest prices at the pump since June 2022, when Russia’s invasion of Ukraine created comparable supply disruption. Jet fuel, also affected by the conflict, surfaced in the May data for the first time, pushing air transportation costs up 7.4% annually.
Stripping out gasoline, inflationary pressure was still building. The CPI excluding fuel climbed 2.2% year over year in May, up from 2.0% in April.
Food purchased from stores rose 4.3% annually, marking the 16th consecutive month that grocery inflation has outpaced the headline CPI.
Fresh vegetables surged 9.0% year over year, with tomato prices up 45.2%, which Statistics Canada attributed to poor weather and reduced planted acreage in Mexico, partly a consequence of US tariff-driven shifts in crop decisions.