Canada's annual inflation rate ticked down to 2.8 per cent in February, defying expectations

Statistics Canada says the annual inflation rate edged down to 2.8 per cent in February.

Statistics Canada says the annual inflation rate fell to 2.8 per cent last month, despite forecasters who had widely expected an acceleration in price growth.

The federal agency says the slowdown was driven by lower prices for cellular and internet services, as well as lower grocery price inflation.

Canada's inflation rate was 2.9 per cent in January.

Prices for food purchased at stores in February were up 2.4 per cent from a year ago, marking the first time grocery prices rose more slowly than overall inflation since October 2021.

The Bank of Canada's preferred core measures of inflation, which strip out volatility in prices, also fell last month.

Meanwhile, housing costs continue to put upward pressure on inflation, with mortgage interest costs up 26.3 per cent and rent up 8.2 per cent annually.

This report by The Canadian Press was first published March 19, 2024.