Canada’s inflation rate edges up to 1.3 per cent in July

Canada’s annual rate of inflation edged up one-tenth of a point 1.3 per cent in July, Statistics Canada said Friday.

The agency said the rise was mostly due to a 6.1 jump in gasoline prices, which helped pushed the overall cost of transportation higher.

However, food prices — another major component of the inflation calculation — were only 0.8 per cent higher on average in July than they were a year earlier, the smallest gain since June 2010.

The modest lift in inflation is less than economists had anticipated and indicates inflation pressures remain well in check in Canada.

Core inflation, the best indicator of structural, underlying price pressures, also came in at a tame 1.4 per cent in July, well below the Bank of Canada’s target of two per cent.

Little in the Statistics Canada report would suggest consumer prices were escalating quickly, and many items, including mortgage costs, video equipment, personal care supplies, travel tours and medicines registered price drops over the past year.

On a month-to-month basis, prices were only one-tenth of a point higher in July than they had been in June.