-Bank of Canada
Consumer prices in Canada rose more than expected in October, as prices of gasoline and clothing soared. The consumer price index climbed 2.4% compared with October a year ago, the most in four months and following the 2.0% gain in September, Statistics Canada reported. Analysts, however, expected a slightly slower pace of acceleration to 2.1%. Clothing and footwear price gains increased to 3.1%, from September's 2% rate, as retailers offered fewer discounts, while gasoline prices climbed 0.6% in October from a year earlier. On a monthly basis, gasoline dropped 4% in October, the fourth straight decline. Food prices increased 2.8% in October, including a 12.4% surge for meat purchased at stores. The core CPI gauge, which strips out eight volatile components, rose 2.3%, the fastest clip since February 2012. On a monthly basis, total inflation inched higher 0.1% in October, while and the core rate climbed 0.3%.
The Bank of Canada has underlined that the recently improved inflation data are due to temporary factors and not the diminishing economic slack. In October's Monetary Policy Report the central bank highlighted the core inflation rising "more rapidly than was expected," largely due to "unexpected sector-specific factors." Bank of Canada Governor Stephen Poloz said inflation will be held down by economic slack that persists for about two years.
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