Canada's annual inflation rate remained at 2.2 percent in March as higher gasoline prices were offset by lower prices for clothing and computers, Statistics Canada said Thursday.

The core rate of inflation, which excludes such volatile items as energy, tobacco, and fruits and vegetables, also held steady at 1.7 percent, still well within the Bank of Canada's inflation target of one to three percent. Analysts had expected the core rate to slip to 1.6 percent.

On a month-over-month basis, the consumer price index rose 0.5 percent, again due to rising gas prices.

Statistics Canada said prices at the pump were an average of 7. 4 percent higher than a year ago, with much of that increase coming in the past month. Gas prices jumped 5.2 percent between February and March.

In addition to higher costs to fill up their gas tanks, consumers also paid more for their cars and trucks. The costs of buying and leasing vehicles rose 3.5 percent in March compared to one year ago. Homeowners' replacement cost also increased by six percent between March 2005 and March 2006, Statistics Canada said.

But consumers paid less for computer equipment and supplies. Prices in that sector dropped 16.7 percent year-over-year. The cost of clothing for both women and men was also lower and that has been a continuing trend in recent years due to cheaper imports, Statistics Canada said.

Source: Xinhua