Canada’s annual inflation rate fell to 1.8% in February 2026, down from 2.3% in January.
Statistics Canada attributes the drop partly to the federal GST/HST tax holiday-December 2024 through February 2025-which artificially depressed year-over-year price comparisons. The distortion is most pronounced for restaurant food, alcoholic beverages, and toys.
The report does not yet reflect economic impacts of the Iran war, which began February 28.