Canada’s inflation rate quickened to the fastest this year in July on gains in food and automobiles and a reduced drag from lower gasoline prices.
The consumer price index rose 1.3 percent in July from a year ago following the June pace of 1.0 percent, Statistics Canada said Friday from Ottawa. The core rate, which excludes eight volatile products, increased 2.4 percent. Both measures matched the median predictions of economists in a Bloomberg News survey.
Bank of Canada Governor Stephen Poloz has said the “underlying trend” of inflation is about 1.5 percent to 1.7 percent, reflecting slack in the economy. Today marks the last inflation report before a Sept. 9 interest-rate decision and most economists predict no move following two cuts this year including at the last decision.
Automobile prices rose 2.5 percent in July from a year earlier, up from 2.0 percent in June. Food prices advanced 3.2 percent including a 6.1 percent gain in meat.
Gasoline prices fell 12.2 percent on a 12-month basis in July, less than a 14.1 percent decline in June, Statistics Canada said.
On a monthly basis, total inflation rose 0.1 percent in July and the index of core prices was unchanged. Both results matched economist survey forecasts.
The Bank of Canada sets interest rates to keep the inflation rate in the middle of a 1 percent to 3 percent target band.