Inflation is finally slowing down…but it’s not showing

Finally, a breather for consumers after 13 months of uninterrupted increases. The inflation rate fell slightly in July, but unfortunately this is hardly visible in the portfolio.

• Also read: Finally a first sign of slowing inflation in the country

• Also read: Travel prices are increasing

“I don’t think it’s coming out yet. Like blueberries, strawberries, meat… it’s still very expensive. That’s why I come here to pay less,” explains Paul Lupien The newspaper met at the Jean Talon market yesterday afternoon.

The same goes for Julie Trottier, a fruit and vegetable producer from Saint-Eustache, who believes the context remains tight for customers.

“There really aren’t any bargains! There are pears, kiwis and grapes, which might be a bit cheaper. But honestly I’ve never seen that, corn for $9 a dozen,” she says, discouraged.

While the signs of a slowdown are not yet evident, the slowdown is well underway. After peaking at 8% in June, Quebec’s inflation rate fell to 7.3% in July. In Canada, it rose from 8.1% to 7.6%.

This decline is mainly due to the price of gasoline, which fell 8.5% in one month in Quebec on fears of an economic slowdown and recession.

Food prices are rising again

For groceries, the increase was 0.2% compared to June, 8.9% yoy. But for some categories, the price fell slightly in July.

This applies in particular to meat, the price of which fell by 1.1% compared to June. Vegetables fell by 1% and fruit by 2.9% over a month, a trend already visible in June.

“What is certain is that our vegetables have always had the same price in recent months. Sometimes it goes down 50 cents. It is stable at the moment. Now it’s tomato season, we’re lowering the prices a bit, but not too much because we have costs involved,” explains Josée Sansoucy, who works for producers André and Dominic Palardy in Saint-Damase.

Josée Sansoucy from producers André and Dominic Palardy

Photo Olivier Bourque

Josée Sansoucy from producers André and Dominic Palardy

good harvest

Although the spring in Quebec was rainy, especially in June, the summer harvest is reported by producers to be good and demand is in balance with supply.

“It’s very very good. We have nothing to complain about on this side. We have a lot of vegetables. We produce peppers and peppers and not all of our varieties have come out yet,” says Sansoucy.

Julie Trottier, fruit and vegetable producer

Photo Olivier Bourque

Julie Trottier, fruit and vegetable producer

“It’s a good harvest this year, except for strawberries because it rained. But producers have maintained a stable price for traders so that it is not too visible to consumers,” added Annabelle Orenalla Flores from the Mont-Rouge vegetable garden.

Other product categories also contributed to the price decline, notably transportation (the steepest decline since April 2020) and the cost of clothing and footwear.

Another rate hike

Despite these encouraging signs, inflation is still a long way off the Bank of Canada’s 2% target, which is expected to pick up again in the autumn.

“Although this suggests the worst is behind us, inflation remains too high, which should encourage the Bank of Canada to raise interest rates by 75 basis points in September,” said an economic note from the national bank.

Desjardins expects interest rates to be raised by 50 basis points.

–In collaboration with Sylvain Larocque


Price development from June to July

  • flight tickets +26%
  • travel services +7%
  • Accommodation for travelers +3.7%
  • dairy products and eggs -0.8%
  • meat -1.1%
  • Fresh fruits -2.9%
  • beings -8.5%

Source: Statistics Canada

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