Canadians are getting some relief in gas prices and airfare in what experts say is a combination of inflation-cutting factors in recent weeks.
“I think it’s great,” Calgary resident Steve Pauls told CTV News. “It’s about time we saw a little break.”
According to Statistics Canada, lower gas prices is one of the main contributing factors to the unexpected ease in inflation. The other reason was falling travel prices.
Inflation slows
“The expectation was that inflation was going to be 2.6 per cent and comes in at 2.3 per cent. I see this as being a good sign,” said Moshe Lander, economics professor at Concordia University.
Lander says the sources of inflationary pressure in Canada were mostly domestic and not because of trade wars. He says it gave the Bank of Canada “a little bit of a cushion” ahead of the interest rate decision on Wednesday, when it moved to hold the rate at 2.75 per cent.
“Maybe not to cut interest rates, but at least they realize they don’t have to start trying to really undo some damage just quite yet,” said Lander.
Why are gas prices down?
The removal of the federal consumer carbon price on April 1, combined with a drop in global oil prices in response to the tariff war, has driven down the price of gas. Dan McTeague, president of Canadians for Affordable Energy, says he predicts an even more affordable outcome for consumers.
“If I compare April, which hasn’t finished yet, 2025 compared to April 2024, the difference is, looking at about $0.24 on average,” said Mcteague.
“If you think inflation heading down is something to newsworthy today as it is, you ain’t seen nothing yet. Next month is going to see an even greater drop.”
Airfare down 12 per cent
As for travel prices declining, year-over-year StatsCan data shows prices for travel tours declined 4.7 per cent in March and air transportation prices fell 12 per cent.
The drop in travel prices coincided with decreased Canadian air travel to the U.S.
Onanta Forbes, travel expert at Travel Time Inc., says a quarter of their clients are looking at other destinations other than the United States.
“The demand for travel is still high. People are just redirecting their funds and where they’re going to go, at the end of the day, because people still want to travel,” said Forbes.
