08/19/2016 11:00 EDT

Inflation And Retail Reports: Canadians Buying Less Food, Booze As Prices Rise

Food, shelter costs offset lower gas prices.

  • Gas prices down but food, shelter costs up
  • Retail sales decline
  • Big drop in alcohol sales

OTTAWA — The country's annual inflation rate was 1.3 per cent in July as Canadians paid more for shelter and food but less for fuel, Statistics Canada said Friday.

This overall inflation number in the federal agency's latest consumer price index came in a little weaker than the 1.5 per cent year-over-year increase in June.

Prices climbed in most major categories compared with 12 months earlier — with the cost of shelter and food items generating the biggest upward nudges on inflation, the report said.

Chart: Statistics Canada

For example, the index found that Canadians paid 9.8 per cent more for potatoes last month compared with July 2015, 10.3 per cent more for fresh or frozen fish and 15.6 per cent more for apples. Under the shelter category, the price of electricity was 5.4 per cent higher than the year before.

In contrast, gasoline prices fell last month by 14 per cent compared to a year earlier, fuel oil dropped 13.4 per cent and natural gas slid 10.3 per cent.

The agency's core annual inflation rate, which omits some volatile items like gasoline, stayed at 2.1 per cent last month.

Retail sales down as food, booze decline

On Friday, the agency also released its latest data for retail trade, which showed that total sales in June were 0.1 per cent lower than the previous month. The overall number rang in at just over $44.1 billion in June.

By comparison, revised numbers showed that total retail sales were essentially flat in May after rising 0.8 per cent in April.

Beer, wine and liquor sales saw their biggest one-month drop in three years. (Photo: Canadian Press)

The agency found that weaker sales at food and beverage stores — down 1.5 per cent compared to May — were a big contributor to the overall June decline in retail sales.

At these stores, beer, wine and liquor sales dropped 4.7 per cent — the largest one-month drop in booze sales since June 2013, Statistics Canada said.

Sales at motor vehicle and parts dealers were up two per cent in June. The category received a boost from a 2.5-per-cent increase in sales at new car dealers, which saw their numbers rise for the first time in five months, Statistics Canada said.

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