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Economic Viewpoint

Will Food Inflation Come Back Down to Earth in 2026?

March 5, 2026
LJ Valencia
Economist

Highlights

  • Food inflation accelerated sharply after the pandemic. And while conditions briefly improved, food price growth picked up again in 2025.
  • In the near term, we anticipate food inflation to remain elevated relative to pre-pandemic norms, with food purchased from stores being a main driver of food price growth for much of 2026. Price growth in food purchased from restaurants is expected to be slower but sustained as the year progresses.
  • Factors such as base effects stemming from the GST/HST holiday, higher import prices and rising input costs are likely to keep food prices trending upwards. Extreme weather events and other supply-chain shocks remain key sources of upside risk to food price growth.
  • That said, we anticipate food inflation to make only a modest contribution to headline Consumer Price Index (CPI) inflation over the forecast horizon, contributing roughly 0.5 percentage points (ppts) to headline CPI inflation in 2026 and 0.4 ppts in 2027. Other components such as shelter are likely to have a larger impact on overall inflation.

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Will Food Inflation Come Back Down to Earth in 2026? (PDF, 396 KB)
NOTE TO READERS: The letters k, M and B are used in texts, graphs and tables to refer to thousands, millions and billions respectively. IMPORTANT: This document is based on public information and may under no circumstances be used or construed as a commitment by Desjardins Group. While the information provided has been determined on the basis of data obtained from sources that are deemed to be reliable, Desjardins Group in no way warrants that the information is accurate or complete. The document is provided solely for information purposes and does not constitute an offer or solicitation for purchase or sale. Desjardins Group takes no responsibility for the consequences of any decision whatsoever made on the basis of the data contained herein and does not hereby undertake to provide any advice, notably in the area of investment services. Data on prices and margins is provided for information purposes and may be modified at any time based on such factors as market conditions. The past performances and projections expressed herein are no guarantee of future performance. Unless otherwise indicated, the opinions and forecasts contained herein are those of the document’s authors and do not represent the opinions of any other person or the official position of Desjardins Group.