Canada’s annual inflation rate in February jumped to 2.2 percent from 1.7 percent in January, the highest level in more than three years, in part due to costlier gasoline, Statistics Canada said on Friday.
The annual rate – greater than the 2.0 percent forecast by analysts in a Reuters poll – was the most elevated since the 2.4 percent recorded in October 2014.
The Bank of Canada, which has a 2.0 percent target for inflation, has raised interest rates three times since July 2017 amid a strengthening economy and near record low unemployment, and markets expect another hike by this July.
Among the main contributors to the higher annual inflation rate in February were a 12.6 percent jump in gasoline prices and a 4.0 percent increase in food purchased from restaurants.
The Bank of Canada’s three measures of core inflation also all strengthened. CPI common, which the central bank says is the best gauge of the economy’s underperformance, increased to 1.9 percent, the highest since February 2012.
CPI median, which shows the median inflation rate across CPI components, rose to 2.1 percent, while CPI trim, which excludes upside and downside outliers, also edged up to 2.1 percent.