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.

Just Posted

Mischief and break and enter to businesses

Used at one of the locations was an axe that broke when a man attempted to break a window

Light Up the Night coming to Stettler Town and Country Museum

First annual gingerbread house contest added to event

The Growler Guy entrance smashed by vehicle

Damages happened sometime in the early morning hours of Nov. 19th

Youth flock to Stetter air cadet program

Promoting respect, citizenship, leadership for youth 12-19

PHOTO: Car Club presents donation to the Stettler Hospice Foundation

The $1,000 donation came from the Drag Race event this past July

Bye bye Bei Bei: Giant panda born in U.S. zoo heads to China

Panda heads back to China as part of cooperative breeding program

Members of little people community applaud change to drop ‘midget’ term

‘It’s not about sensitivity,’ says Allan Redford, the president of the Little People of Canada

Red Deer man facing 13 charges after late night pursuit

Leduc RCMP with assistance from Edmonton Police make arrest

Nothing funny about funny money in Leduc

Leduc RCMP investigate multiple files involving counterfeit currency

‘Midget’ no more: Sweeping division name changes coming to minor hockey in Canada

Alpha-numeric division names will be used for the 2020-2021 season and beyond

Ottawa urges CN and union to continue talks as 3,200 workers go on strike

The rail workers began their strike after failing to reach a deal by a midnight deadline

University of Calgary to slash payroll after post-secondary funding cuts

The government is also cutting all funding for the Infrastructure Maintenance Program

Trans Mountain received $320M in government subsidies in first half 2019: report

The money included $135.8 million in direct subsidies and $183.8 million in indirect subsidies

Canadian universities encourage exchange students in Hong Kong to head home

UBC said 11 of its 32 students completing programs in Hong Kong have already left

Most Read