Canada's inflation rate lower in July at 2.1 per cent

Food prices rose by 2.9 per cent

OTTAWA – The rise of Canada’s cost of living index was tempered in July, with the annual inflation rate coming in at 2.1 per cent.

That was down from June when the Consumer Price Index rose by 2.4 per cent over 12 months, a two-year high, according to Statistics Canada.

The agency says prices were higher in all 12 categories it looks at, with shelter costs leading the way, up 3.0 per cent in July, higher than the 2.9 per cent increase seen in June.

Food prices also rose by 2.9 per cent, matching the previous month’s up tick.

Fresh vegetables made up a big chunk of the increase in food prices, rising 7.5 per cent on a year-over-year basis.

In the volatile energy category, natural gas prices skyrocketed in July, up 20.4 per cent from the same month a year earlier.

However, gasoline costs were up by just 2.1 per cent in July, backing off from the 5.4 per cent increase recorded in June.

Removing energy and food prices from the mix, Canada’s core inflation rate _ the number the Bank of Canada looks at most closely _ was up by 1.7 per cent in July, down from 1.8 per cent the previous month.

The cost of home and mortgage insurance was also up, along with property taxes.

Ontario, Saskatchewan and Alberta saw the biggest jump in prices in a provincial breakdown.

StatsCan says Ontario’s inflation rate reached 2.5 per cent in July, although that was down from a 3.0 per cent spike in June.

In Saskatchewan, prices were also up by 2.5 per cent for July, an increase from the previous month’s 2.2 per cent marker.

British Columbia recorded the smallest increase on a provincial basis, at 1.4 per cent, down from 1.9 per cent in June.

Retail sales figures for June were also released Friday in a separate Statistics Canada report.

The agency reported a sixth consecutive monthly increase in sales, up 1.1 per cent to $42.6 billion.

Retail sales were up in 8 of 11 subsectors, and higher by 4.7 per cent overall in the first half of the year compared with the same period in 2013.

General merchandise stores saw sales rise the most in June, up 3.9 per cent.

Here’s what happened in the provinces and territories. (Previous month in brackets):

—Newfoundland and Labrador 2.2 (2.5)

—Prince Edward Island 1.8 (2.0)

—Nova Scotia 2.0 (2.2)

—New Brunswick 1.8 (2.0)

—Quebec 1.6 (1.7)

—Ontario 2.5 (3.0)

—Manitoba 1.5 (1.9)

—Saskatchewan 2.5 (2.2)

—Alberta 2.5 (1.9)

—British Columbia 1.4 (1.9)

—Whitehorse, Yukon 1.0 (1.0)

—Yellowknife, N.W.T., 1.7 (1.8)

—Iqaluit, Nunavut 1.2 (1.0)