Canada’s inflation rate is only just beginning to drop after a massive spike in July that accompanied the introduction of the harmonized sales tax in B.C, Ontario and Nova Scotia.
According to Statistics Canada, the nation’s annual inflation edged down one-tenth of a point to 1.7% in August; prices fell 0.1% from July.
However, underlying core inflation remained the same at 1.6%. The Bank of Canada uses core inflation to gauge price pressures across the country. This stagnant number is well below the bank’s 2% target.
According to the report in the Toronto Star, the HST will add an estimated 0.7% to the annual inflation rate—even more in the three affected provinces.
For more read: Inflation dips in August.