May CPI Inflation Rebounded to +4.3% on Crop Supply and Fuel Impact on Produce

Research evidence excerpt

May CPI Inflation Rebounded to +4.3% on Crop Supply and Fuel Impact on Produce

June 22, 2026 | 15:36 ET~

Retailing/Consumer Retailing/Consumer

Étienne Ricard, CFA Analyst

etienne.ricard@bmo.com (416) 359-5296

Emily Foo, CFA VP Associate

May CPI Inflation Rebounded to +4.3% on Crop emily.foo@bmo.com (416) 359-6484

Legal Entity: BMO Nesbitt Burns Inc.Supply and Fuel Impact on Produce

Bottom Line:

May CPI grocery inflation rebounded to +4.3% from +3.8% last month. The re-

acceleration in overall grocery inflation was largely due to higher fresh fruit and fresh

vegetable prices due to reduced supply and higher fuel costs (which are reflected by

immediate price changes at the item level and not as a surcharge). We continue to

believe Statistics Canada CPI grocery inflation could remain in the MSD % range.

Key Points

May StatsCan Grocery CPI inflation rebounded back to +4.3% from a slight

pullback to +3.8% in April, but remains within our expectation as we had expected

the potential for re-acceleration due to recent geopolitical developments (see charts on

pg. 2).

Acceleration in Fresh Fruits and Fresh Vegetable Prices. The re-acceleration in

overall grocery inflation was largely from higher fresh fruit and fresh vegetable prices

due to reduced supply and higher fuel costs (which are reflected by immediate price

changes at the item level and not as a surcharge). Fresh Fruits inflation was +5.3% vs. a

prior slight deflation trend in recent months and Fresh Vegetables inflation was +9.0%

vs. +4.1% last month.

All Major Categories Experienced Inflation. Aside from fresh produce, categories with

high inflation included: Meat at +10.9% (similar to past few months), and CPG at +4.4%

(slight deceleration vs. last month’s +5%). Dairy/Eggs, Seafood, and Bakery/Cereal