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Consumer price index dragged down by declining gas prices

Consumer prices in B.C. fell 1.1% in August. That's the second biggest drop among Canadian provinces after Alberta, where prices fell 1.7%, according to Statistics Canada data released Thursday.

Consumer prices in B.C. fell 1.1% in August.

That's the second biggest drop among Canadian provinces after Alberta, where prices fell 1.7%, according to Statistics Canada data released Thursday.

Canadian consumer prices fell in August at the second-fastest annual rate in more than 50 years.

Nationwide, prices fell by 0.8% in August compared with a year earlier, dragged down by falling gasoline prices.

National gasoline prices fell 21.2% between August 2008 and August 2009, following a 12-month decline of 28.3% in July.

That translates into an average per-litre price at the pump of $1.01 in August compared with $1.27 in August 2008.

Overall energy prices dropped 19.1% year-over-year in August.

In July, the consumer price index slid 0.9%. That was the sharpest annual decline since 1953, when the CPI fell 1.4%.

The Bank of Canada closely monitors core inflation because it excludes volatile items such as gasoline and some foods. That rate met expectations by inching up 0.1% in August and 1.6% year over year.

Canada's central bank has targeted 2% inflation and has said that it expects both core CPI and overall CPI to hit that target by mid-2011.