Canada September Inflation Hits 3.1 Percent Amid Energy Spikes
Statistics Canada reports annual inflation rose to 3.1 percent in September, driven by surging gasoline and fuel oil prices linked to Middle East conflict.
Canada's annual inflation rate rose to 3.1 per cent in September, according to data released by Statistics Canada on October 19, 2026. The increase was driven primarily by a 27.8 per cent spike in gasoline prices and a 57.8 per cent surge in fuel oil, which the agency attributed to the ongoing war in the Middle East. These energy costs particularly impacted residents in Atlantic Canada who rely heavily on oil for home heating.
Regional data showed significant variance across the country. Prince Edward Island recorded the highest inflation rate at 5.7 per cent, followed by Nova Scotia at 5.6 per cent. In contrast, Ontario reported the lowest annual rate at 2.5 per cent, while Quebec and British Columbia remained stable at 3.1 per cent and 3.0 per cent respectively. Newfoundland and Labrador, New Brunswick, and Manitoba all saw rates exceeding 4 per cent.
Other sectors showed mixed trends. Grocery prices saw their smallest yearly increase since May 2024, rising only 1.7 per cent due to price drops in confectionery, sugar, and fresh vegetables, though overall grocery costs have climbed 33 per cent since September 2020. Shelter prices rose 1.8 per cent, influenced by higher home maintenance and mortgage insurance costs. Excluding gasoline, consumer prices increased by 2.2 per cent year-over-year.
This report serves as the final price data before the Bank of Canada's interest rate decision on October 28. Bank of Canada Governor Tiff Macklem previously warned that persistent energy prices increase the risk of broader inflation.
