Canada's annual inflation rate inched up to 1.9% in January from the previous month as higher gasoline and natural gas costs reduced the impact of a sales tax reprieve on broader consumer prices, official data showed on Tuesday.

TORONTO (Reuters) - Canada's annual inflation rate rose 1.9% in January, up from 1.8% in December as lower prices helped by a sales tax reprieve were partly offset by higher cost of gasoline and natural gas, data showed on Tuesday.

The rate of inflation in January came in higher than just the month before, a Statistics Canada’s report shows. StatCan released its consumer price index report for January 2025, showing the rate of inflation rose 1.9 per cent year over year. The inflation rate is up from December's 1.8 per cent.

Canadian consumer prices reaccelerated for the first time in three months as the central bank’s preferred core measures are proving sticky.

Economists are more confident the Bank of Canada might pause its interest rate cuts next month — tariffs notwithstanding — as Canada's annual inflation rate ticked back up in January.

Canada’s yearly inflation rate rose to 1.9 percent in January, after slowing to 1.8 percent in December. January was the first full month of the GST holiday, which temporarily reduced prices on products typically subject to the tax.