Statistics Canada says the annual rate of inflation cooled to 1.7 per cent in July as lower gas prices led the decline from 1.9 per cent in June.
The agency says prices for gasoline were down 16.1 per cent year-over-year, thanks largely to the removal of the consumer carbon price.
Gas prices were also down 0.7 per cent on a monthly basis following an increase in production from oil-exporting countries and a ceasefire in the conflict between Israel and Iran.
There were signs of price pressure building for grocery bills last month as costs rose 3.4 per cent annually at grocery stores, up from 2.8 per cent in June.
Confectionary and coffee products saw big year-over-year price jumps in July, which StatCan said were tied to tough growing conditions in countries that produce cocoa and coffee beans.
Shelter inflation also saw its first increase since February of last year as rent price gains accelerated.
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