Gas and Food Prices Boost Inflation

Gas and Food Prices Boost Inflation - Annual inflation was 2.9 percent in October, driven mainly by higher prices of gasoline and food prices, Statistics Canada said Friday. It was a little higher than expected, as economists surveyed by Bloomberg had predicted 2.8 percent. Yet it was less than the inflation rate of 3.2 per cent seen in September. This marks the 11th consecutive month of overall inflation was running at more than two percent, the Bank of Canada's goal. However, given the economic uncertainty created by factors such as governmentdebt crisis in Europe, economists say that inflation is unlikely to push the central bank raised its key rate by one percent in an effort to tame rising prices .

"The data, while the upward surprise should have a limited impact on the policy of the Bank of Canada, as the bank is more focused on external risks and the views of the considerable slowdown in the national economy, which ultimately downward pressure on inflation, "said economist of CIBC World Markets Emanuella Enenajor.

Gas and Food Prices Boost InflationSome also said that inflationary pressures are easier in the coming months.
"With today's release of the data, we see that the peak of inflation experienced in recent months was indeed temporary," said TD Economics economist Sonya Gulati. "Prices of raw materials and the economic slowdown is an impulse to help curb the growth of inflationary pressures."

The rate of core inflation in October, the factors that the volatile elements, some food and energy was 2.1 percent in October. It fell 2.2 percent in September, but higher than economists' forecasts of 1.9 percent. Gasoline prices are still a big reason why consumers are burning through cash faster than they were a year ago. But twelve months decreased to 18.2 percent in October this particular product is 22.7 percent in September.

Annual Inflation Rates by Province in October
Saskatchewan 2.8%
Nova Scotia 3.9%
Quebec 3.3%
Newfoundland and Labrador 3.5%
Ontario 2.7%
Manitoba 3.0%
P.E.I. 2.9%
British Columbia 2.3%
New Brunswick 4.0%
Alberta 3.4%

Food prices increased by 4.3 percent in October from a year earlier, as they were in September. Shops, food to pay people to 4.9 per cent more than last year and 3.1 percent more in restaurants.

Gas and Food Prices Boost Inflation
Prices increased in all eight categories of significant price for Statistics Canada. Price increases were the largest transportation by 6.7 percent, which is reflected in gasoline. Within this group, consumers pay for auto insurance and own vehicle. Housing increased 1.5 percent. This is recognized in higher costs for heating oil, electricity and property taxes, but lower mortgage interest costs.

On a monthly basis, overall consumer prices rose 0.3 percent in October from September on a seasonally adjusted basis. That was the end of the 0.4 percent advance in the price of a month ago.

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