Gas price plunge drops annual inflation to 0.7% in October

Statistics Canada says consumers were paying less — sometimes much less — for goods and services last month than they were in September.

The agency says its price index declined 0.2 per cent in October from the previous month, taking the annual inflation rate to 0.7 per cent, the lowest since May.

It was a drop of fourth-tenths of a point since September’s rate of 1.1 per cent — the biggest one-month decline since April.

In both the monthly and annual rates, the price of gasoline was the major contributor to lower inflation.

The cost of filling up the car plunged 5.1 per cent in October from September.

Compared with the same time last year, gasoline prices were 4.3 per cent lower last month than in October 2012.

But Statistics Canada says there were also other factors at play.

On a monthly basis, hotels, natural, electricity and fresh vegetables were all lower last month than in September.

And on an annual basis, transportation, clothing and footwear, health and personal care, mortgage interest, prescribed medicines and tools and other household equipment all cost less in October than they did a year ago.

The agency says consumer prices rose at a slower pace year-over-year in seven out of the 10 provinces, with British Columbia registering an outright decline of 0.3 per cent.

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