OTTAWA—Canadian consumer prices picked up their pace last month as the annual inflation rate moved up from very low levels and closer to the Bank of Canada’s ideal target of two percent, Statistics Canada said Friday.
Higher gasoline prices helped push the annual inflation rate in September to 1.6 percent, up from 1.4 percent a month earlier and away from its two-year low of just one percent in June, the agency said. Excluding gas prices, inflation was 1.1 percent.
The inflation-targeting central bank scrutinizes inflation ahead of its rate decisions. Its next benchmark rate announcement is scheduled for next Wednesday.
However, only one of the bank’s three preferred measures of core inflation, which seek to look through the noise of more-volatile items, increased last month while the others stayed put.
Statistics Canada also released numbers Friday that showed retail sales contracted 0.3 percent in August, after increasing 0.4 percent in July. Retail sales volumes in August recoiled 0.7 percent.
Excluding sales at gas stations and auto dealers, the report said retail trade was down 1.3 percent in August. Sales were also down 2.5 percent at food and beverage stores and 2.4 percent at furniture and home furnishings stores.
The retail sales data suggests the economy is starting to show signs of slowing down, as widely expected, following its red-hot performance in the first half of the year.
On inflation, the report highlighted gasoline, travel tours and air transportation as the biggest upward contributors to consumer prices. The downward pressure was led by cheaper electricity, women’s clothing furniture.
The report also found that consumer prices rose in seven of the 10 provinces in September.