Inflation in Canada fell to 3.1% in October, down from 3.8% in the previous month due primarily to a drop in gas prices.
Statistics Canada said on Tuesday that gas prices declined 6.4% in October alone and were down 7.8% year over year.
Excluding gas, Canada’s consumer price index (CPI) rose 3.6% in October, down from 3.7% in September, the agency said.
Grocery prices continue to remain elevated with a 5.4% increase in the 12 months ended in October but are down from 5.8% in September.
Prices for services rose 4.6% on a year-over-year basis in October, up from a 3.9% increase in September.
Rent prices also increased at a faster pace in October, up 8.2% year over year compared to a 7.3% increase in September.
Month over month, the CPI rose 0.1% in October following a 0.1% decline in September driven by travel tours, property taxes and other charges which are priced annually in October.
The report demonstrates that the Bank of Canada’s interest rate hikes continue to make progress in bringing inflation down to its 2% target.
At its upcoming meeting in early December, the central bank is widely expected to once again keep interest rates unchanged after holding at 5% for the past two meetings.
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