Bank of Canada 'miles from being out of the woods' even as inflation eases: BMO

Canadian inflation eased in August amid a decline in gasoline prices, but economists are warning there’s a long way to go to get price pressures back to the Bank of Canada’s two per cent target.

While gasoline prices fell 9.6 per cent in the month, Canadians were feeling pressures on everyday staples – grocery costs surged 10.8 per cent in the month, the largest increase in 41 years.

In a note to clients, TD Economics Managing Director & Senior Economist Leslie Preston said the latest inflation print was a small step in the right direction, but there’s still a long way to go.

“A journey of a thousand miles starts with a single step. Canadian inflation took a single step in the right direction in August, but it still has a long way to go,” she said.