Statistics Canada building and signs are pictured in Ottawa on Wednesday, July 3, 2019. THE CANADIAN PRESS/Sean Kilpatrick

Canadian annual inflation rate 1.9% last month as lower gas prices weigh on rate

Canadians did, however, pay more for mortgage interest costs

The annual inflation rate was 1.9 per cent in September for a second-straight month, keeping the indicator close to the Bank of Canada’s ideal two per cent target.

The new numbers released Wednesday in Statistics Canada’s latest consumer price index report show that price growth was once again held back by lower gas prices.

Inflation has now stayed at 1.9 per cent or higher for seven consecutive months.

Economists on average had expected a reading of 2.1 per cent for September, according to financial markets data firm Refinitiv.

The country’s price picture, on its own, is not applying pressure on the inflation-targeting Bank of Canada to adjust interest rates. The central bank’s next rate announcement is scheduled for Oct. 30.

Statistics Canada said a 10 per cent drop in gasoline prices compared with last year continued to weigh on the overall inflation rate. Gas prices, year-over-year, were down 10.2 per cent in August and 6.9 per cent in July.

Excluding pump prices, the inflation reading for September was 2.4 per cent for a third-straight month.

READ MORE: Canadian inflation decelerates to 1.9% as gas prices weaken

Upward momentum in price growth was also held back in September by lower costs, year-over-year, for internet access services, tuition fees and telephone services.

Canadians did, however, pay more for mortgage interest costs, vehicle insurance and auto purchases last month compared to the previous year.

Shoppers shelled out 3.4 per cent more for passenger vehicles last month than they did a year earlier as price growth in the category exceeded 2.5 per cent for a seventh-straight month, the report said. Statistics Canada called it the “strongest continuous stretch of growth” in the category since early 2017.

Year-over-year mortgage interest costs have increased through 2019 and were up another 7.5 per cent in September. The report said the growth has followed a series of interest rate hikes by the Bank of Canada between July 2017 and October 2018.

In terms of downward forces, the report said tuition fees decreased 3.6 per cent last month for the category’s first year-over-year decline since its creation in 1973. The drop was driven by an 8.9 per cent decrease in Ontario, where the provincial government cut tuition for the 2019-20 academic year.

The average of Canada’s three measures for core inflation, which are considered better gauges of underlying price pressures by omitting volatile items like gasoline, moved up slightly to 2.1 per cent last month from two per cent in August. The core readings are closely monitored by the Bank of Canada.

Andy Blatchford, The Canadian Press


Like us on Facebook and follow us on Twitter.

Just Posted

Green candidate reflects on South Okanagan-West Kootenay campaign

Rosslander Tara Howse talks about the highs and lows of running for office

Community Christmas Hamper Program seeks donations, applications

Families can register for a hamper at Boundary Family Services and Community Futures

RDKB directors divided over dam revenues and fire service

East-end directors voted in favour of using $300,000 from the dam to support the RDKB fire service

Veterans lead the line for the Border Bruins in 2019/2020

Nathan Cohen-Wallis and captain Liam Stalwick are among the team’s points leaders too

Buyout residents ask for expert representation in land negotiations

City: ‘We’re really hoping that […] we can come to agreements that preserve people’s net worth’

VIDEO: Canadian allergists’ group wants Benadryl behind the counter due to side effects

Some doctors say the medication is over-used because of its easy availability

Sex assault charge stayed against Port Moody mayor

Rob Vagramov completed an alternative measures program, special prosecutor said

“I thought, enough is enough”: B.C. teen takes on bullies through social media

‘I thought, enough is enough. I wanted to try something to stop it.’

Audit finds Canada’s fisheries in decline and response lacks urgency

Report says 17 per cent of fish stocks are critically depleted, up from 13.4 per cent in 2018

Small group of Cherry fans protest his firing at Rogers HQ

One sign at the Toronto rally: ‘Rogers cancels Don, we cancel Rogers’

Nearly half of B.C. drivers nervous in winter conditions: BCAA

‘Wait and see’ approach common practice for 32% of B.C. motorists

Autism support dog refused bus access for being a ‘pet’

B.C. grandmother files complaint with TransLink, calls for better awareness of service dogs

Students plan rally at B.C. education minister’s office as district strike enters third week

Saanich School District students plan to rally outside Rob Fleming’s constituency office in Victoria

73% of B.C. residents agree with a temporary ban on vaping products: poll

54% say they would not date someone who vapes, Research Co. poll suggests

Most Read