Inflation rate rises to 1.9 per cent in September

CTV.ca News Staff - Date: Fri. Oct. 22 2010 7:52 AM ET
Canada's annual inflation rate rose two-tenths of a point to 1.9 per cent last month, driven largely by the cost of energy and new cars.
The rate increase follows an inflation drop in August and had been generally expected, because of the recent run-up in oil prices.
Statistics Canada said much of the gain came from energy prices, which were 5.6 per cent higher than a year earlier. Gasoline was 3.1 per cent more expensive, and electricity was up 7.7 per cent from a year earlier.
The agency said it also noticed a big pick-up in the price of passenger vehicles during the month -- 5.0 per cent -- as manufacturers shaved the level of incentives they were offering consumers.
The core inflation rate, which excludes eight volatile items, actually slowed to 1.5 per cent from 1.6 per cent. The core inflation is what the Bank of Canada closely monitors to spot underlying trends.
On an annual basis, prices rose in seven of the eight component groups that Statistics Canada measures.
Homeowner replacement costs rose 5.6 per cent; transportation was up 3.1 per cent; shelter costs advanced 2.5 per cent; and food costs rose 2.1 per cent.
Prices also rose on cigarettes 4.6 per cent, alcoholic beverage prices rose 2.4 per cent and tuition rose 3.8 per cent.