Statistics Canada reported on Wednesday the country’s consumer price index (CPI) rose 0.6 percent m-o-m in July, following a 0.3 percent m-o-m gain in the previous month. This was the fastest pace since January.

On the y-o-y basis, Canada’s inflation rate increased 3.7 percent last month, accelerating from 3.1 percent in June. This was the highest rate since May 2011.

Economists had predicted inflation would increase 0.3 percent m-o-m and 3.4 percent y-o-y in July.

According to the report, prices rose at a faster pace in six of the eight major components on a y-o-y basis in July, with shelter prices (+4.8 percent y-o-y) contributing the most to the all-items advance.

Meanwhile, the closely watched the Bank of Canada's core index surged 3.3 percent y-o-y in July, following a 2.7 percent y-o-y jump in June.