- Bank of Canada
Canada's inflation rate accelerated in November to the fastest pace in a year as higher gasoline prices dropped out of annual calculations, bringing the key gauge closer to the Bank of Canada's 2% goal. Canada's consumer price index jumped to 1.4% last month from a year ago, compared with October's 1%, according to Statistics Canada. However, core inflation, which excludes volatile items and is closely watched by the central bank, declined to 2.0%. Overall, prices rose in seven of the eight major components of the consumer price index. The transportation component, which includes gasoline, was the only one to decline. Still, its drop of 1.1% was the smallest annual decline registered since last November. Food costs increased 3.4% in November from a year earlier, with higher prices for fresh vegetables and meat contributing the most to the gain. A 1.2% increase in the cost of shelter also contributed to the rise in inflation.
The relatively subdued rate of inflation was likely to give the central bank plenty of room to keep interest rates low after it cut them twice this year to offset the impact of cheaper oil prices on Canada's resource-oriented economy. The BoC said it does not view inflation as a big concern at the moment. In December, the central bank reiterated that the current underlying inflation is between 1.5% and 1.7%.
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