The annual pace of inflation slowed more than expected in September as increases in the price of gasoline eased compared with August.
Statistics Canada said Friday the consumer price index in September was up 2.2% from a year ago as opposed to a year-over-year increase of 2.8% in August. Analysts had expected a CPI of 2.7% for the past month.
The transportation index, which includes gasoline, was up 3.9% compared with a 7.2% move in August as gasoline prices last month were up 12% versus a 19.9% increase in August. However, the transportation group remained the largest contributor to the overall year-over-year increase in the index.
Food prices were up 1.8%, while shelter costs rose 2.5%. Alcoholic beverages and tobacco products were up 4.4%.
In a separate report, Statistics Canada said retail sales fell 0.1% in August to CAD 50.8 Billion as sales moved lower in seven of 11 of the subsectors tracked by the agency. Sales at gasoline stations were down 2.0%, while clothing and clothing accessories stores fell 1.2%. Motor vehicle and parts dealers saw sales increase 0.8%. Retail sales in volume terms were down 0.3%.
The inflation report comes ahead of the Bank of Canada’s rate decision this week when it will also update its forecast for the economy in its monetary policy report. The central bank aims to keep inflation within a target range of 1 to 3% and adjusts its interest rate target to help achieve that goal.