Canadian inflation and retail sales miss forecasts

Canada's annual inflation rate dropped to its 10-month low last month, official data showed on Friday. According to Statistics Canada, the Consumer Price Index (CPI) declined to 1.1% year-over-year in August, staying below the Bank of Canada's 2.0% target level for seven straight months. Market analysts expected consumer prices to grow 1.4% in the reported month, after rising 1.3% in July. On a monthly basis, the CPI fell 0.2% in August, unchanged from the preceding month, whereas economists expected it to increase 0.1%. The so-called core CPI came in at 0.0% last month, also unchanged from July's reading. Analysts expected core consumer prices to accelerate 0.2% in the eight month of the year. 

Separately, Statistics Canada reported that Canadian retail sales dropped 0.1% month-over-month in July, following the previous month's 0.0% reading and missing the 0.2% rise forecast. Excluding volatile components, so-called core retail sales came in at 0.0% in the same month, unchanged from June, while markets anticipated a slight acceleration of 0.2% during the reported month. After the release, the Canadian Dollar weakened against its US counterpart, trading at $0.7611.