Canada’s annual inflation rate in March edged up to 2.3 percent from 2.2 percent in February, the highest level in more than three years, in part due to costlier gasoline, Statistics Canada said on Friday.
The annual rate – slightly less than the 2.4 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 maintains 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 see an 80 percent chance of an increase by this July.
The main contributor to the higher annual inflation rate in March was a 17.1 percent jump in gasoline prices. Seven of the eight major components increased on a year-over-year basis.
The Bank of Canada’s three measures of core inflation were little changed. CPI common, which the central bank says is the best gauge of the economy’s underperformance, remained at 1.9 percent.
CPI median, which shows the median inflation rate across CPI components, stayed at 2.1 percent, while CPI trim, which excludes upside and downside outliers, edged down to 2.0 percent from 2.1 percent.