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Canada’s inflation rate slows to 7.0%, despite food prices hitting 41-year high According to Reuters



© Reuters. FILE PHOTO: Apple prices at a Northmart grocery store in Iqaluit, Nunavut, Canada July 28, 2022. REUTERS/Carlos Osorio

By Julie Gordon

OTTAWA (Reuters) – Canada’s annual inflation rate eased more than expected in August and the index fell month-on-month for the first time this year, Statistics Canada data showed. Tuesday, even as food prices rose at the fastest rate. for 41 years.

The country’s annual inflation rate fell to 7.0% in August, lower than analysts’ forecasts of 7.3% and down from 7.6% in July. Statscan said, The decline was largely due to lower gasoline prices and slower gains in the haven index.

For the month, the consumer price index fell 0.3%, the biggest drop since the beginning of the COVID-19 pandemic.

All three core inflation measures, considered a better indicator of underlying price pressures, also fell slightly, with the average falling to 5.2% from an upwardly revised 5.4% in January. July.

While inflation appears to be pulling back from its peak, it is still well above the Bank of Canada’s 2% target.

The central bank raised its policy rate 75 basis points to 3.25% this month and left the door open to another overshoot, saying it continues to see head-on as the best way to combat prices are increasing rapidly.

Money markets are betting on a 50 basis point increase in late October, followed by a smaller 25 basis point move in December to lift interest rates to 4.0%, the highest level since the start. 2008.

The Canadian dollar was trading 0.4% lower at 1.33 per US dollar, or 75.19 US cents.



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