Canada's inflation slowed to 2.8% in December 2026, prompting possible interest rate stability.

A new report released on January 12, 2026, reveals that Canada’s inflation rate slowed to 2.8% in December, down from 3.1% in November, driven by declining prices in housing and transportation. The Bank of Canada indicated it may hold interest rates steady in the near term, citing stable wage growth and persistent core inflation. Meanwhile, consumer spending rose slightly, suggesting continued economic resilience despite higher borrowing costs.