Canada’s inflation holds at 2.2% in November despite rising food prices

Canada’s overall inflation rate remained steady at 2.2% in November, unchanged from October, Statistics Canada reported. The figure came in slightly below economists’ expectations, but rising food prices continue to be a concern and are expected to persist into 2026.

Grocery prices increased 4.7% year over year in November, up from 3.4% in October and the highest level since December 2023. The acceleration was driven largely by higher prices for fresh berries and prepared foods such as soups and snacks. Beef prices rose sharply, up 17.7%, due to lower cattle inventories across North America. Meanwhile, the cost of refined coffee jumped 27.8% annually, reflecting U.S. tariffs and adverse weather conditions in coffee-producing regions.

Economists say food inflation is likely to remain “stubbornly high” at least through early 2026. The Food Price Report projects food-sector inflation of 4–6% next year. A weaker Canadian dollar and ongoing global trade tensions are adding to price pressures.

Last week, the Bank of Canada held its key interest rate at 2.25%. Analysts widely expect the central bank to keep rates unchanged in 2026, as core inflation remains above target but shows no signs of strong acceleration.

In November, gasoline prices were lower on a year-over-year basis, though they rose 1.8% month over month due to refinery disruptions. Consumers saw some relief in travel costs, with prices for travel tours falling 8.2% and accommodation costs down 6.9%. Rent growth also slowed.

Experts caution that inflation data will be volatile in the coming months due to the impact of last year’s tax breaks and the removal of the consumer carbon price, but overall inflation is expected to gradually return toward the Bank of Canada’s 2% target over the next year.