June 27 2024: Ontario inflation ticks upward; elevated services prices and energy costs

June 27, 2024

Ontario inflation increased from 2.7% in April to 3% in May. In particular, energy and services inflation were higher than usual compared to prior months. The Industrial Product Price Index revealed lower year-over-year inflation in fabricated metal products and construction materials, plastic and rubber products, whereas energy and petroleum products inflation continued on an upward trajectory.

Ontario’s headline inflation increased from 2.7% (y/y) in April to 3% in March; excluding food and energy the change was almost identical, rising from 2.6% to 3%. Energy inflation was relatively high at 4.7% (down from 5.1% in April); recent energy price inflation is higher than it’s been in over two years. Services price inflation increased from 3.8% to 4.3%,continuing the trend of higher inflation which began late 2021. A key element of reaching the 2% target will be ensuring the services component cools down (in addition to mortgage interest costs and rent).

Note: Inflation excluding food and energy, or “core” inflation is often of interest since food and energy prices tend to be volatile and may not represent average underlying prices trends.

Decreasing Prices

Fabricated metal products and construction materials inflation was -0.9% y/y (-0.4% in April) marking the 15th month in a row of slightly cooler y/y prices. Plastic and rubber products inflation was similarly cool with -1.3% y/y (-1% in April).

Mild Price Inflation
Packaging material and containers inflation was mild at +1.1% y/y (up from +0.7% in April). Lumber and other wood products inflation stalled at +0.2% y/y, dropping down from the elevated +6.1% from April.

Elevated or Increasing Prices
Cement, glass, and other non-metallic mineral products inflation remains high at +7.4% y/y. However, this was lower compared to +8.2% y/y from April. Energy and petroleum products inflation has been increasing since February, moving into positive territory in April at +3% y/y, and increasing yet again to +4.5% in May.



Ali Ahmad
Research Analyst

Ontario Construction Secretariat (OCS)
180 Attwell Drive, Suite 360, Toronto, ON M9W 6A9
P 416.620.5210 ext. 222