Inflation Rate between 1981-2019 | Canada Inflation Calculator (2024)

FAQs

What was the inflation rate in Canada in 1981? ›

Consumer price inflation in Canada averaged 2.2% in the ten years to 2022. This is above the major economies' regional average of 2.1%. In contrast, the 2022 average figure was 6.8%.

Canada faced a serious inflation problem in the 1980s and 1990s when the consumer price inflation (CPI) index hit 13 per cent in 1980 and was still at seven per cent in 1991. To solve this issue, in 1991, the Bank of Canada and the Minister of Finance agreed on a plan to bring inflation down to a target level.

Core Inflation Rate in Canada averaged 2.26 percent from 1984 until 2024, reaching an all time high of 6.20 percent in June of 2022 and a record low of 0.00 percent in June of 1984.

Inflation Rate in Canada decreased to 2 percent in August from 2.50 percent in July of 2024. Inflation Rate in Canada averaged 3.15 percent from 1915 until 2024, reaching an all time high of 21.60 percent in June of 1920 and a record low of -17.80 percent in June of 1921.

Both the 1980 and 1981-82 recessions were triggered by tight monetary policy in an effort to fight mounting inflation. During the 1960s and 1970s, economists and policymakers believed that they could lower unemployment through higher inflation, a tradeoff known as the Phillips Curve.

In Canada, the euro area, and the U.S. core goods prices have been declining in recent months. For the U.S., in particular, the rolling quarterly rate of goods inflation has been below zero since September 2023, while in Canada the near-term pace of deflation touched 2.6% (annualized, 3-mo/3-mo basis) in April.

Canada Inflation Rate is at 2.53%, compared to 2.67% last month and 3.27% last year. This is lower than the long term average of 3.15%.

Events. January 1 – Gasoline and diesel are sold by the litre rather than the gallon. February 5 – More than three hundred men are arrested after police sweeps of Toronto bathhouses. The arrests create an outcry among Canada's gay population, and become a historic turning point in Canadian LGBT history.

What stopped inflation in the 80s? ›

Inflation fell but was still high even as the economy recovered in the second half of 1980. But the Volcker Fed continued to press the fight against high inflation with a combination of higher interest rates and even slower reserve growth.

The Canadian economy experienced overall weakness from the start of 1980 to the end of 1983, with low yearly real GDP growth rates of 2.1% and 2.6% in 1980 and 1983, respectively, and a steep 3.2% decline in real GDP for 1982. As with other G7 countries, Canada had two separate economic contractions in the early 1980s.

Inflation was a serious problem for Canada—and many other industrial countries—in the late 1970s and 1980s, peaking at 12.5 per cent in 1981. Two upward oil price shocks and accommodative macroeconomic policies were the key factors behind this inflationary period.

Canada inflation rate for 2022 was 6.80%, a 3.41% increase from 2021. Canada inflation rate for 2021 was 3.40%, a 2.68% increase from 2020. Canada inflation rate for 2020 was 0.72%, a 1.23% decline from 2019. Canada inflation rate for 2019 was 1.95%, a 0.32% decline from 2018.

Exchange rates affect how expensive international products are for Canadians. Canada imports a lot of food, especially during the winter when much less is produced domestically. High levels of imported food mean that exchange rates—particularly for the US dollar—affect grocery prices here.

The Prime Rate in the 1980s

Paul Volcker wanted to tame inflation and the Bank of Canada followed suit. The prime rate, which had fallen to 12.25% in July 1980 jumped to 22.75% by August 1981. A five-year fixed rate mortgage peaked at 21.5%. The good news: inflation was no longer out of control.