A big jump in gasoline prices at the pump compared with one year earlier drove the annual inflation rate up to 2.6% in August, Statistics Canada reported today.

That’s up sharply over the 2% inflation rate reported in July.

StatsCan said if energy prices were excluded, overall inflation last month would have been a moderate 1.6%.

Restaurant prices and homeowner replacement costs also edged up last month, pushing up inflation.

Those increases were offset by lower costs from computer gear and traveller accommodation.

The core rate, which excludes the volatile energy and food categories and is closely watched by the Bank of Canada, rose to 1.7% in August from 1.4% the month before.

That rise in core inflation could push the Bank of Canada to raise interest rates again at its next opportunity in mid-October.