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B.C. inflation rate eases to 2.5 per cent in September

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B.C.’s annual inflation rate eased to 2.5 per cent in September, according to Statistics Canada.

Data released Friday (October 19) reveals the annual pace for inflation decreased 0.5 percentage points between August and September.

The national inflation rate, meanwhile, slowed to 2.2 per cent year over year compared with 2.8 per cent the month before.

The 2.2 per cent figure registered “well below” the consensus forecast of 2.7 per cent, according to TD senior economists James Marple.

“Inflation has been volatile over the past few months, but the signal beneath the noise is an underlying rate close to the Bank of Canada's 2.0 per cent target,” he said in a note to investors.

“The relative stability of the Bank of Canada's core measures is consistent with an economy operating close to potential, but not ringing any alarm bells in terms of overheating.”

Marple pointed out most of the slowdown in inflation was a result of a cooling in transportation, air transportation and gas prices.

Growth in transportation prices eased to 3.9 per cent annually in September compared with 7.2 per cent in August.

Growth in gas prices eased to 12 per cent annually compared with 20 per cent a month earlier, and air transportation slowed to 7.4 per cent from 26.4 per cent.

“Together, these two items [gas and air transportation] took 0.5 percentage points from the headline reading,” Marple said.

– Tyler Orton, Business in Vancouver