By Paul Vieira
OTTAWA--Canada's annual inflation rate accelerated in September, due to price changes in the transport and shelter components.
Still, inflationary pressure remains contained and unlikely to alter the Bank of Canada's expectation to keep its main interest rate unchanged for the foreseeable future.
Canada's consumer-price index increased 0.5% on a year-over-year basis in September, Statistics Canada said Wednesday, versus a 0.1% rise in the previous month. The result matched market expectations, according to economists at TD Securities.
On a month-over-month basis, prices declined 0.1% in September. The annual inflation rate rose, though, because of a weak year-ago base.
Meanwhile, the Bank of Canada's preferred measures for underlying inflation rose slightly from the previous month, according to Statistics Canada, with the average core CPI in September at 1.73% compared with 1.7% in August.
"There are no big surprises in Canadian inflation, with headline price trends still barely above zero overall and core quite stable and below 2%," said Doug Porter, chief economist at BMO Capital Markets.
September's inflation report was somewhat affected by the transport component. Airfares and travel services posted smaller declines than typically observed in September, according to analysts at TD Securities. Further, prices related to shelter rose, 1.7% on an annual basis, on the strength of a 2.6% climb in homeowner replacement costs--or the price a homeowner has to pay to maintain a residence at its current market value.
Write to Paul Vieira at firstname.lastname@example.org
(END) Dow Jones Newswires