Ottawa, Apr 19 (IANS): Canada's Consumer Price Index (CPI) rose 4.3 per cent year over year in March, following a 5.2 per cent increase in February, according to the national statistical agency.

This was the smallest increase since August 2021, Statistics Canada said on Tuesday.

As a result of the steep monthly increase in prices in March 2022, base-year effects, notably gasoline prices, continued to have a strong downward impact on consumer inflation, contributing to the year-over-year deceleration in March 2023, reports Xinhua news agency.

Excluding food and energy, prices were up 4.5 per cent year over year in March, following a 4.8 per cent gain in February, while the all-items CPI excluding mortgage interest cost rose 3.6 per cent, after increasing 4.7 per cent in February, Statistics Canada said.

According to Statistics Canada, on a monthly basis, the CPI was up 0.5 per cent in March, following a 0.4 per cent gain in February.

On a seasonally adjusted monthly basis, the CPI rose 0.1 per cent.

While headline inflation has slowed in recent months, having increased 1.7 per cent in March compared with 6 months ago, prices remain elevated.

Compared with 18 months ago, inflation has increased 8.7 per cent, Statistics Canada said.

Tiff Macklem, governor of Bank of Canada, said on Tuesday that several things still have to happen to get inflation all the way back to the 2 per cent target: inflation expectations have to come down further, services price inflation and wage growth need to moderate, and corporate pricing behaviour has to normalize.

Last week, the central bank maintained the policy rate at 4.5 per cent, with an aim to return inflation to the 2 per cent target next year.