The Consumer Price Index, or CPI, is a measure of the overall change in consumer prices based on a representative basket of goods and services over time.

Or, in easier terms, inflation rose to 4% year over year in August 2023.

The 4% increase follows a 3.3% increase from July 2023. This jump in inflation can be mainly credited to the prices of gasoline rising, where in August gasoline rose +0.8% compared to -12.9% in July. If you exclude gasoline, the CPI rose at 4.1% in August, which matched the July increase.

It wasn’t just gas that Canadians paid higher for in August – this trend of rising prices spilled into other areas of necessities such as higher rents and mortgage interests. While food prices still increased, they are described as a “smaller increase….compared with the previous month.”

On a monthly basis, the CPI rose 0.4% in August after a 0.6% gain in July. Why? This slowdown was mainly driven by travel tours (-6.4%) and air transportation (-6.9%), as prices fell month over month following summer travel demand which peaked in July.

-via Bank of Canada