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.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Teck donates land to Elkford Housing Society

The land donation ceremony took place on January 16

Fernie Hotel supports through bushfire fundraiser

Sunday Funday at The Fernie raised thousands for Australian Bushfire Relief On… Continue reading

Ridgemont trail network closed to public

On January 10, 2020, the Fernie Trails Alliance issued a press release… Continue reading

New plane for Air Search and Rescue Association

The new Cessna 182 will also be used for Angel Flight services

Fernie Chamber of Commerce signs lease for downtown coworking space

By: Brad Parsell, Executive Director Fernie Chamber of Commerce The Fernie Chamber… Continue reading

Officials reaching out to those in contact with Canada’s first coronavirus patient

The illness has sickened at least 1,975 people and killed 56 in China

Canada’s basketball community mourns Kobe Bryant after helicopter crash

Bryant was an 18-time NBA all-star who won five championships

‘Devastated’: Fans, celebrities remember Kobe Bryant after his death

Bryant played all of his 20-year career with the NBA with the Los Angeles Lakers

Kobe Bryant, daughter killed in California helicopter crash

Bryant entered the NBA draft straight out of high school in 1996

Investigation launched after six dead puppies dumped in Richmond hotel parking lot

RAPS reminds people they can always give up puppies they can’t take care of

Canadian Lunar New Year celebrations dampened by coronavirus worries

But Health Minister Patty Hajdu said today that the risk of infection is low

B.C. VIEWS: New coronavirus outbreak an important reminder

Walking the line between cautious and alarmist

Risk of coronavirus low in B.C. as first case emerges in Toronto: officials

There have been no confirmed cases of the virus in B.C.

Most Read