Inflation at 1.7%, Holy Cow!

Weaker Gasoline prices is the reason given, but I am still stymied by the fact that inflation is dropping even with gas prices at $1.00 per liter again.

Now inflation is the measure of how much things have risen in price, not that things are expensive in the first place, so I guess this makes sense, but more expensive fuel should be rippling through prices in the economy, however that does not seem to be happening?

Here is the break down on things for you who love numbers.

Consumer Price Index and major components
(2002=100)
	Relative importance	August 2007	July 2007	August 2006	July to August 2007	August 2006 to August 2007
		Unadjusted
					% change
All-items	100.00	111.7	112.0	109.8	-0.3	1.7
Food	17.04	111.8	112.3	109.2	-0.4	2.4
Shelter	26.62	117.6	117.0	113.5	0.5	3.6
Household operations and furnishings	11.10	103.5	103.2	101.7	0.3	1.8
Clothing and footwear	5.36	95.4	94.6	95.4	0.8	0.0
Transportation	19.88	116.3	118.5	118.0	-1.9	-1.4
Health and personal care	4.73	107.6	107.5	105.5	0.1	2.0
Recreation, education and reading	12.20	102.9	103.0	101.2	-0.1	1.7
Alcoholic beverages and tobacco products	3.07	126.1	126.0	121.8	0.1	3.5
All-items (1992=100)		132.9	133.3	130.7	-0.3	1.7
Special aggregates
Goods	48.78	107.7	108.6	108.1	-0.8	-0.4
Services	51.22	115.6	115.3	111.4	0.3	3.8
All-items excluding food and energy	73.57	109.2	109.1	106.8	0.1	2.2
Energy	9.38	136.4	139.6	141.7	-2.3	-3.7
Core CPI	82.71	110.1	110.0	107.7	0.1	2.2
1. 2005 CPI basket weights at April 2007 prices, Canada – Effective May 2007. Detailed weights are available under the Documentation section of survey 2301 (http://www.statcan.gc.ca/english/sdds/index.htm). 2. Figures may not add up to 100% due to rounding. 3. The measure of the core Consumer Price Index (CPI) excludes from the all-items CPI the effect of changes in indirect taxes and eight of the most volatile components identified by the Bank of Canada: fruit, fruit preparations and nuts; vegetables and vegetable preparations; mortgage interest cost; natural gas; fuel oil and other fuel; gasoline; inter-city transportation; and tobacco products and smokers’ supplies. For additional information on the core CPI, please consult the Bank of Canada website (www.bankofcanada.ca/en/inflation/index.htm).