September 18, 2025
SUMMARY
Ontario’s headline inflation was 1.7% y/y in August, up only a tick from 1.6% in July. Energy inflation was slightly higher than early months, but still in the negatives as it changed from -12.2% to -9.8%. Many trends held compared to July, but shelter inflation decreased from 2.2% to 1.7%.
CONSUMER PRICE INDEX INFLATION
Ontario’s headline inflation was still within the target range at 1.7% y/y in August, a bit lower than the national inflation of 1.9%. Energy inflation “heated” a little bit, rising from -12.2% to -9.8%. Goods inflation saw a modest upward tick from -0.1% to 0.1%. Core inflation, which excludes the volatile food and energy categories, continues to trend higher than All-Items Inflation and came in at 2.2% y/y (down from 2.4% in July). Looking at some of the more stubborn components of CPI, services inflation cooled slightly from 2.8% y/y to 2.7% and shelter inflation dropped from 2.2% to 1.7% (lowest since January 2021).
In related news, the Bank of Canada trimmed the overnight lending rate from 2.75% to 2.5%, primarily due to softer labour markets, lower underlying inflation trends, and scaling back of retaliatory tariffs.
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FOR MORE INFORMATION, CONTACT:
Ali Ahmad
Research Analyst
Ontario Construction Secretariat (OCS)
180 Attwell Drive, Suite 360, Toronto, ON M9W 6A9
P 416.620.5210 ext. 222
aahmad@iciconstruction.com
