Canadians grappling with high grocery costs may finally see sustained relief on the horizon, according to the country's top central banker. Bank of Canada Governor Tiff Macklem has projected that the persistent pressure from food inflation is expected to ease significantly by the year 2026.
A Long-Awaited Forecast for Consumer Wallets
The announcement, made on December 16, 2025, offers a glimmer of hope for households that have been adjusting their budgets amid rising costs at the checkout. While Macklem did not provide specific percentage forecasts for the decline, his statement signals a belief that the complex factors driving up food prices will gradually normalize over the coming year.
This outlook is rooted in an analysis of broader economic trends, including stabilizing global commodity prices and adjustments within domestic supply chains. The Bank of Canada's monetary policy, which has aimed to cool overall inflation, is also anticipated to have a lagging positive effect on the food sector.
The Road to More Stable Prices
Reaching this point of relief has been a multi-year challenge. Food inflation has remained stubbornly high compared to other consumer basket items, driven by a confluence of issues. These have included extreme weather events impacting crops, higher input costs for farmers and processors, and ongoing global supply chain complexities.
The projected easing by 2026 suggests that the Bank believes these pressures are, at last, beginning to abate. It is important to note that this forecast points towards a slowing in the rate of increase, not necessarily an outright drop in absolute prices. However, it would mean the annual jump in grocery bills becomes less severe.
Context and Cautious Optimism
Governor Macklem's statement provides a forward-looking anchor for both consumers and policymakers. It comes as other measures, like the grocery code of conduct set to take effect on January 1, aim to introduce more fairness and transparency into the food supply system.
While the 2026 timeline indicates that significant relief is not immediate, it offers a tangible goalpost. Economists will be closely watching upcoming inflation reports for early signs of this deceleration in food prices. For now, the Bank of Canada's message is one of cautious optimism, forecasting that the financial strain of feeding a family will begin to lessen within the foreseeable future.
