August Inflation Held at 3.0% — But Ontario Ticked Up to 2.4% and Rent Is Accelerating Again

Statistics Canada released its August 2026 Consumer Price Index on September 14, and the headline number did not move: the CPI rose 3.0% year over year, matching July. Month over month, prices fell 0.1% (not seasonally adjusted) and rose 0.2% on a seasonally adjusted basis.

For a GTA market that just absorbed a seventh straight Bank of Canada hold at 2.25%, the composition under that flat headline is the story — slower gasoline, faster travel and rent, and an Ontario print that is no longer the calm outlier it was in July.

What held the headline flat

Gasoline still dominates the year-over-year story, but it cooled: gasoline prices rose 22.8% year over year in August, down from 25.7% in July, as Middle East conflict pressures remained elevated but eased off July's peak pace. That slowdown put downward pressure on the all-items CPI.

Offsetting it were two accelerations StatCan flags explicitly:

• Travel tours jumped 26.1% year over year (after 15.2% in July), partly on a base-year effect as the sharp 2025 drop in Canadian travel to the United States rolled out of the comparison, plus fuel surcharges on higher jet fuel.
• National rent rose 2.8% year over year, up from 2.5% in July, with Manitoba (+4.3%) and Ontario (+2.4%) driving the acceleration.

Strip gasoline out and underlying inflation actually firmed a little: CPI excluding gasoline rose 2.4% in August, after 2.2% in July. The Bank of Canada's preferred core gauges stayed soft — CPI-common at 2.6%, CPI-median at 2.0%, and CPI-trim at 1.9%.

Shelter cooled as a driver — but rent did not

The broad shelter component rose 1.5% year over year (index 190.9 in August vs. 188.0 a year earlier), still a muted read by the standards of the rate-hike cycle. Homeowners' replacement cost was one of the main downward contributors to the 12-month change nationally, falling 1.9%.

Rent is the line GTA landlords and tenants should watch. National rent accelerated to 2.8% year over year, and Ontario's +2.4% rent print is named in the release as a driver of that national move. Paid rent in the CPI basket is still rising on a year-over-year basis.

Grocery inflation (food purchased from stores) slowed to 2.8% year over year from 3.1% in July — and for the first time since July 2024, grocery price growth ran below the all-items CPI. Dairy led the deceleration. Food prices overall are still up 29.0% since August 2021.

Ontario is no longer the calmest print in the country

In July, Ontario held at 2.0% year over year and was the only province that did not accelerate. In August, Ontario's all-items CPI rose 2.4% year over year (index 170.0), up 0.1% month over month. That is still well below the national 3.0% and far below Atlantic rates (Nova Scotia 5.1%, PEI 4.4%, New Brunswick 4.6%, Newfoundland and Labrador 4.3%), but the provincial gap that made Ontario the standout soft patch in July has narrowed.

Six provinces saw faster year-over-year inflation in August than in July. Ontario is back in that group. For GTA households, the local inflation story is no longer "Ontario alone is cooling while the country heats" — it is "Ontario is still milder than the national average, but the direction turned up."

What this means for the October 28 rate decision

The Bank of Canada held at 2.25% on September 2. The next scheduled announcement — with a Monetary Policy Report — is October 28, 2026. A second straight 3.0% headline print does not reopen the door to a near-term cut on its own, especially with CPI excluding gasoline edging up to 2.4%. But the Bank has repeatedly treated gasoline and travel as noisy, and the core trim/median gauges remain near or below 2%.

For GTA buyers weighing a lock vs. wait: this is a "patience with eyes open" print. Headline inflation is stuck at the top of the Bank's 1–3% control range for a second month, Ontario's own CPI ticked higher, and rent in the CPI basket is accelerating again — none of which argues for cheaper variable-rate borrowing into late October. Sellers pricing fall listings should expect buyers to stay rate-sensitive rather than suddenly urgent. Agents fielding client questions now have a clean primary read: inflation did not worsen nationally, but it also did not improve, and Ontario is no longer the one-province exception it was in July.

Sources

• Statistics Canada — The Daily: Consumer Price Index, August 2026 (released September 14, 2026)
• Bank of Canada — Policy rate held at 2.25% (September 2, 2026)

Compiled by the Real Estate HQ editorial desk from primary data releases (sources linked above) and reviewed for accuracy. Figures are as reported on the release date.