SmartHomeOwners

OTTAWA: Statistics Canada says Canada's annual inflation is tracking down again after July's outsized increase.

The annual rate edged down one-tenth of a point to 1.7 per cent last month, following an increase of 0.8 per cent in July due to the introduction of a new sales tax in Ontario, British Columbia and Nova Scotia.

The agency estimates the harmonized sales tax is adding about 0.7 per cent to inflation, assuming no flow-through savings from producers lowering prices.

On a monthly basis, overall prices fell 0.1 per cent in August from July, and the key Bank of Canada core rate, which excludes volatile items such as energy, stayed steady at 1.6 per cent.

Otherwise, the agency says annual prices increased in seven out of eight components tracked, with only clothing and footwear registering a decrease.

The largest gains were for electricity, house prices, car insurance and the cost of food at restaurants.