Canada’s annual inflation up 1.6% in December

Sales rose 1.7 percent, Statistics Canada said on Friday, the biggest increase since June 2014 and topping forecasts for 0.2 percent. Prices for food purchased at stores were up 4.1 percent, with the acceleration mainly attributable to more expensive fresh fruit and vegetables.

The data agency’s transportation index, which includes gas prices, increased by 0.6% after declining for each of the previous 13 months.

Fresh fruit and vegetable costs rose 13 percent in December from a year earlier, pushing up overall food costs by 3.7 percent.

The core rate that excludes eight volatile products slowed to 1.9 percent from 2 percent in the prior month, the slowest pace since July 2014. Clothing and accessories stores (up 2.2%) and electronics and appliances stores (up 2.1%) had strong showings this month.

Core inflation had an annual average increase of 2.2 per cent a year ago, reaching its highest level in a year-end review since 2003.

Increased sales at new auto dealers were the main contributor, up for the fifth consecutive month with a gain of 4.5 per cent. The strength in recent months has been driven by higher sales of new trucks.

Statistics Canada also released data Friday for retail sales in November. They were up 1.7 per cent compared to the previous month as Black Friday promotions and a boost in sales at new auto dealerships helped push the total figure up to $44.3 billion.

Passenger vehicles were 3.1 per cent more expensive in December than it was a year ago.