Inflation rate unchanged at 1.6% last month

Inflation rate unchanged at 1.6% last month

OTTAWA—The country’s annual inflation rate once again rang in at 1.6 per cent last month as higher energy costs offset a seventh consecutive decline in grocery store prices, Statistics Canada said Friday.The agency’s consumer price index for April identified higher prices for gasoline and natural gas as the biggest upward drivers in year-over-year inflation.On the other hand, fresh produce and clothing applied the most downward pressure on the inflation rate.Read more:Inflation rate slows to 1.6% as sliding food costs offset gas pricesHeading into next week’s interest rate announcement, experts like BMO chief economist Doug Porter expect the Bank of Canada to emphasize the softening underlying inflation indicators, which strip out some of the more volatile components.Article Continued Below“The modest core inflation we’re seeing is probably the single, strongest argument the Bank of Canada has to do nothing,” Porter said, adding that ongoing uncertainty over U.S. policy, particularly on trade, would be up there as well.“There’s just no rush, no urgency at all for the Bank of Canada to move on rates.”Porter said on the one side, there are all kinds of indicators — like hot housing markets, robust consumer spending, the low unemployment rate and strong growth to start the year — telling the central bank to hike its very low interest rate policy.

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