Canada Inflation Rises to 1.9% in June 2025, Below BoC Target for Third Month

Canada’s annual inflation rate rose to 1.9% in June 2025, up from 1.7% in May and in line with market expectations. Despite this increase, inflation stayed below the Bank of Canada’s (BoC) 2% midpoint target for the third consecutive month, consistent with the BoC’s forecast amid ongoing tariff pressures and supply disruptions. This shows how the inflation in Canada for June 2025 remained below target.

Key Inflation Highlights – Canada June 2025 📊

• Canada inflation for June 2025 rose to 1.9% year-on-year, from 1.7% in May.
• Fuel deflation slowed sharply to -13.4%, compared to -15.5% the previous month.
• Transportation costs eased by -0.6%, improving from -1.4% in May.
• Prices for durable goods climbed, with passenger vehicles up 5.2% and furniture up 3.3%.
• Food inflation slowed to 2.9%, down from 3.4%, driven by softer grocery price growth.
• Shelter inflation eased slightly to 2.9% from 3.0%.
• The trimmed-mean core CPI, BoC’s preferred inflation gauge, remained steady at 3.0%.

Read More: Canada’s Unemployment Rate Hits 7% in May 2025

What This Means for the Bank of Canada and Consumers

The slower decline in fuel prices helped lift overall inflation, while rising durable goods costs added further pressure. However, softer food price growth and stable shelter inflation helped keep the rate below the BoC’s target. In June 2025, Canada inflation impacted consumers differently, indicating the central bank is likely balancing these changes.

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