Canadian inflation remains steady

Canadian consumer prices crept slightly higher in November compared to the previous month keeping Canada’s annual rate of inflation at 2.9% in November, matching October’s rise, according to Statistics Canada.

The 0.1% spike in consumer prices from October to November is in line with the expectations of economists.

Transportation and food continued to post the largest increases, the report noted. The cost of transportation increased 5.7% in the 12 months to November, following a 6.7% gain in October. In addition to paying more for gasoline, consumers also paid more in passenger vehicle insurance premiums (4.4%) and for the purchase of passenger vehicles (1.8%).

The year-over-year increase in food prices remained high at 4.8%, but the 12-month change in gasoline prices continues to ease. Gasoline prices were up only 13.5% annually, after advancing 18.2% in October.

The Bank of Canada’s closely watched measure of core consumer prices, which leaves out eight of the Consumer Price Index’s most volatile components, edged up 0.1% on-month, and was up 2.1% in the 12 months to November, roughly in line with the BoC’s target for annual inflation.

The Bank has kept its benchmark interest rate at a record-low 1% since September of 2010.

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