Canadian producer prices drop 1.4% in June as U.S.-Iran pact eases energy costs

Raw materials costs fell 6.9% as oil plunged, but relief proved short-lived

OTTAWA — Canadian producer prices dropped 1.4% in June from the prior month, marking the first month-over-month decline in five months, as a short-lived U.S.-Iran agreement lowered energy costs, Statistics Canada reported.

The industrial product price index, which measures the prices manufacturers receive when their goods leave the plant, marked its first month-over-month decline in five months. Compared with the same month in 2025, the index was up 12.4%, marking the 21st consecutive month of an annual increase.

The month-over-month decline reflected a June drop in energy prices after the U.S. and Iran reached a tentative interim agreement that halted military attacks and allowed oil-tanker traffic to resume through the Strait of Hormuz. The agreement was short-lived: U.S. and Iranian forces resumed strikes this month, and crude oil prices in July were roughly 30% higher than at the start of the month.

Prices for raw materials, the costs manufacturers pay for inputs before processing, fell 6.9% in June from May. On a year-over-year basis, raw-material costs rose 20.7%.

The producer-price data are consistent with Canada’s June consumer-price report, which showed the headline CPI declined 0.4% from the prior month as gasoline costs fell. The Bank of Canada has said it sees limited evidence that higher energy prices are broadly lifting costs for other goods and services, pointing to spare capacity and tepid consumer demand in the economy.

Unlike the consumer price index, the producer-price index excludes indirect taxes, such as sales taxes and tariffs, and all costs that occur after a good leaves the plant.