Newspaper article The Canadian Press

Canada's Inflation Rate Falls to 1.0% in September on Lower Gasoline Prices

Newspaper article The Canadian Press

Canada's Inflation Rate Falls to 1.0% in September on Lower Gasoline Prices

Article excerpt

Canada's inflation rate falls to 1.0%

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OTTAWA - The annual pace of inflation slowed in September due to lower gasoline and other energy prices, but the cost of groceries, restaurant meals and many other things pushed higher.

Statistics Canada's consumer price index for September rose 1.0 per cent compared with a year ago -- a smaller increase than the 1.3 per cent posted in August and below the 1.1 per cent expected by economists.

TD Bank economist Brian DePratto said the dichotomy that has characterized inflation so far this year continued in September.

"Headline inflation remains weak, dragged down by energy prices that remain well below their year-ago levels," DePratto said.

"At the same time, the significant depreciation of the Canadian dollar since last summer has made imports more expensive, helping keep core inflation (slightly) above the Bank of Canada's two per cent target."

Prices were up in seven of the eight major categories, with the overall increase driven by higher food prices, Statistics Canada said.

The cost of food was up 3.5 per cent compared with a year ago, with fresh vegetables up 11.5 per cent and meat up 4.4 per cent. The price of food in restaurants climbed 2.7 per cent.

The index for recreation, education and reading was up 2.5 per cent, while the clothing and footwear category gained 1.2 per cent.

Only the transportation group, which includes gasoline, was lower as it fell 3.5 per cent from a year ago due to an 18.8 per cent decline in gasoline prices compared with last year.

The Bank of Canada's core index, which excludes some of the most volatile components, was up 2. …

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