Cheaper food offsets rising gas prices, easing inflation last month
OTTAWA — The annual pace of inflation ticked higher last month, but the increase was smaller than expected as food prices continued falling, offsetting gas price hikes at the pump.
Statistics Canada said Friday the consumer price index in December was up 1.5 per cent from where it was a year ago, a higher rate of inflation compared with November’s increase of 1.2 per cent. Economists had expected a rise of 1.7 per cent year-over-year in December.
Prices were up in seven of the eight major categories tracked by Statistics Canada, with food the one exception. Food prices declined 1.3 per cent on a year-over-year basis, the third consecutive month prices slipped compared with a year earlier.
CIBC economist Nick Exarhos said much of the weakness in food prices can be attributed to the relative strength of the Canadian dollar and what that means for the cost of imported goods.