February 18, 2026
SUMMARY
Ontario’s inflation rate eased to 2.0% year over year in January 2026, down from 2.1% in December, with core inflation slowing to 1.7%. Food prices remained elevated, while shelter inflation moderated further. Energy prices declined sharply over the year, consistent with the broader national slowdown in headline inflation. Regionally, Toronto and Ottawa saw CPI declines, whereas Thunder Bay recorded an increase.
ONTARIO’S CONSUMER PRICE INDEX
According to the latest Consumer Price Index (CPI) data, inflation in Ontario stood at 2.03% year over year in January 2026, a slight easing from 2.09% in December 2025. On a monthly basis, prices declined by 0.12% in January, following a 0.30% decrease in December.
Core inflation (all-items excluding food and energy) moderated more noticeably, falling from 2.06% in December to 1.74% in January, suggesting underlying price pressures continued to soften at the start of the year.
At the regional level, both Toronto and Ottawa recorded declines in all-items CPI, consistent with the broader provincial moderation. In contrast, Thunder Bay diverged from this trend, with all-items inflation rising to 2.72%, up from 2.6% in the previous month.
INFLATION BY COMPONENT
Food inflation remained a key driver in January and accelerated further, rising to 9.35% year over year, up from 7.49% in December. On a monthly basis, food prices increased by 0.54%. The continued strength in food inflation is partly attributed to base effects associated with last year’s GST and HST holidays.
Shelter price growth continued to ease. Year-over-year shelter inflation slowed sharply to 0.11% in January, down from 0.64% in December, with prices declining 0.21% month over month. The moderation reflects softer rent growth across much of the province.
Energy prices remained a significant drag on headline inflation. Gasoline prices fell 19% year over year in January, contributing materially to the deceleration in overall inflation. At the national level, Statistics Canada identified gasoline as “the largest contributor to the deceleration in headline inflation.” The larger year-over-year decline was mainly due to a base-year effect, as prices were elevated in the same period last year.
Overall energy prices declined 12.41% year over year, compared to an 11.17% decrease in December.
Services inflation eased slightly to 2.93%, down from 3.02%, while goods inflation remained relatively contained at 0.70%, broadly unchanged from December.
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FOR MORE INFORMATION, CONTACT:
Gargi Bharti
Economic and Research Project Lead
Ontario Construction Secretariat (OCS)
180 Attwell Drive, Suite 360, Toronto, ON M9W 6A9
P 416.620.5210
gbharti@iciconstruction.com
