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Inflation accelerates to 1.6% in September; retail trade contracts in August

Last Updated Oct 20, 2017 at 9:00 am EST

A security guard walks past the Bank of Canada Wednesday September 6, 2017 in Ottawa. THE CANADIAN PRESS/Adrian Wyld

Canadian consumer prices picked up their pace last month as the annual inflation rate moved up from very low levels and closer to the Bank of Canada’s ideal target of two per cent.

Statistics Canada says higher gasoline prices helped push the annual inflation rate in September to 1.6 per cent, up from 1.4 per cent a month earlier.

The Bank of Canada scrutinizes inflation ahead of its rate decisions and its next benchmark announcement is scheduled for next week.

However, only one of the central bank’s three preferred measures of core inflation, which seek to look through the noise of more-volatile items, increased last month while the others stayed put.

Statistics Canada also released numbers that showed retail sales fell 0.3 per cent in August, after increasing 0.4 per cent in July.

The retail sales data suggests the economy is starting to show signs of slowing down, as widely expected, following its red-hot performance in the first half of the year.