The annual inflation rate in Canada stabilized at 6.9 percent last month after declining for several months, as Statistics Canada said that the inflation rate did not change in October from September with rising fuel prices.

In the latest Consumer Price Index report issued today, Wednesday, the federal agency said that rising mortgage interest costs also increased pressure on inflation.

However, the offset of rising fuel prices and interest rates caused a slowdown in the growth of grocery and natural gas prices.

On the other hand, grocery prices rose at their fastest pace in decades in recent months.

In October, grocery prices were 11 percent higher than they were a year ago, which is less than 11.4 percent in September.

Despite the slowdown, grocery prices continued to rise at a faster annual rate compared to the overall inflation for the eleventh consecutive month. On a monthly basis, the Consumer Price Index rose by 0.7 percent.

The latest inflation figures come after several months of declines in overall inflation.

After peaking at 8.1 percent in June, inflation slowed largely due to falling fuel prices.

However, fuel prices rose in October for the first time since June, jumping by 9.2 percent from September to October.

Cost of living remains a major concern in the Canadian economy as inflation erodes purchasing power and drives the Bank of Canada to raise interest rates rapidly.

However, the gap between inflation and wage growth is narrowing as inflation slows and wages continue to rise.

In October, wages rose by 5.6 percent compared to last year.

The Bank of Canada has also raised interest rates six consecutive times since March to curb high inflation.

After cutting interest rates to near zero during the pandemic, the central bank moved quickly this year to increase borrowing costs for Canadians and businesses.

Higher interest rates are expected to lead to an economic slowdown that the central bank hopes will reduce inflation.

The Bank of Canada will closely monitor the latest Consumer Price Index report as it prepares for its upcoming interest rate decision scheduled for December.

It is noteworthy that the central bank will watch its preferred core inflation measures, which tend to be less volatile than the headline rate.

These measures rose slightly in October compared to September.