As inflation ticks lower to in December, economists expect further BoC rate cuts [Video]

Canada’s annual inflation rate ticked lower in December, thanks in part to Ottawa’s temporary GST tax break, but economists still see interest rate cuts on the horizon as potential tariffs loom.

Statistics Canada said Tuesday the annual inflation reading for December came in at 1.8 per cent, down from 1.9 per cent in November.

The report noted restaurant food purchases and alcohol bought from stores contributed the most to the deceleration — items which were subject to the tax reprieve, along with children’s clothes and toys, among others.

Without the tax break, the agency said the annual inflation rate would have risen to 2.3 per cent, driven in part by upward pressure from a month-over-month jump in accommodation costs in British Columbia — coinciding with Taylor Swift wrapping up her Eras Tour in Vancouver in early December.

“Looking beyond the tax cut, …