Canada: Inflation quickens on higher gasoline prices
October 21, 2011
In September, consumer prices increased a seasonally adjusted 0.3% over the previous month, which was the same as in August. Higher gasoline prices continued to be the main driver behind the monthly price rise, as reflected by the 0.8% month-on-month increase in prices in the transportation category. On the other hand, food and shelter prices fell in September. Annual headline inflation inched up from 3.1% in August to 3.2% in September, exceeding market expectations of inflation easing to 3.0% and surpassing the upper ceiling of the Central Bank's 2.0% 1% inflation target for the second straight month. Energy prices decelerated from a 13.4% year-on-year increase in August to a 12.5% expansion in September. Annual core inflation, which excludes volatile items such as gasoline and fresh food, increased from 1.9% in August to 2.2% in September. The Bank of Canada expects headline inflation to average 2.9% in 2011 and 1.4% in 2012.