Statistics Canada says annual inflation rate slowed to 3.1% in October

The inflation rate slowed to 3.1 per cent on a year-over-year basis, down from 3.8 per cent in September, as the price of gasoline fell, Statistics Canada said Tuesday.

The inflation rate slowed to 3.1 per cent on a year-over-year basis, down from 3.8 per cent in September, as the price of gasoline fell, Statistics Canada said Tuesday.

The agency said the price drivers paid for gasoline in October fell 7.8 per cent from a year earlier compared with a 7.5 per cent increase in September, driven partly by a spike in gasoline prices in October 2022 after OPEC announced production cuts.

Excluding gasoline, Statistics Canada says the consumer price index was up 3.6 per cent for October, following a 3.7 per cent increase for September.

Prices for goods were up 1.6 per cent, while prices for services were up 4.6 per cent, largely due to higher prices for travel tours, rent and property taxes and other special charges.

Bank of Montreal chief economist Douglas Porter said the inflation report drives home the point that there is no need for further rate hikes by the Bank of Canada, especially with the economy already struggling to grow at all and underlying inflation calming.

“However, before the bank can even begin seriously considering rate relief, we'll need to see more evidence that services inflation is also moderating-that could be at least another six months down the road,” Porter wrote in a note to clients.

Statistics Canada said the largest contributors to inflation continued to be mortgage interest costs, food purchased from stores and rent.