The Canadian Statistical Agency announced on Tuesday that the annual inflation rate fell to 1.8% in December, compared to 1.9% in November. This decrease reflects the impact of a "tax holiday" on goods and services (GST/HST) that began on December 15, according to the agency.

The most affected sectors

Data showed that the prices of food purchased from restaurants and alcoholic beverages - two categories that were exempted from federal taxes for two months - experienced a significant slowdown in annual and monthly inflation rates.

Impact on monetary policy

The Bank of Canada is expected to carefully study these numbers before making its first decision on interest rates for this year, scheduled for January 29.

The importance of indicators

This data is an important indicator of the state of the Canadian economy, as the decrease in inflation helps improve consumers' purchasing power, while giving monetary authorities greater room to assess their interest rate policies.