COST OF FRESH FRUIT, VEGETABLES PUSHES UP INFLATION

Canada’s December inflation rate was the fastest in a year, led by double-digit gains for fruit and vegetables and a reduced drag from gasoline prices. The consumer price index rose 1.6 per cent in December from a year ago following the rate of 1.4 per cent the prior month, Statistics Canada said Friday from Ottawa. The core rate that excludes eight volatile products slowed to 1.9 per cent from 2 per cent in the prior month, the slowest pace since July 2014. Economists surveyed by Bloomberg forecast the total rate would advance 1.7 per cent and core by two per cent. Fresh fruit and vegetable costs rose 13 per cent in December from a year earlier, pushing up overall food costs by 3.7 per cent. Gasoline price declines slowed to 4.8 per cent from 10.6 per cent in November, and automobile prices rose 3.1 per cent. Price gains have lagged the Bank of Canada’s two per cent target for more than a year on cheaper gasoline and slack in the economy holding down increases for other goods. Governor Stephen Poloz on Wednesday kept his key lending rate at 0.5 per cent.