Return to 2% inflation rate could be a bumpy one. Heres why – National [Video]

Economists say inflation likely flared up again in February amid higher gasoline prices, reinforcing the expectation that the journey back to two per cent inflation will be a bumpy one.

Statistics Canada is set to release its February consumer price index report on Tuesday. The consensus expectation among forecasters is that prices rose 3.1 per cent from a year ago.

That would reverse some of the progress made in January, when the annual inflation rate slowed to 2.9 per cent.

“We’re looking for inflation to re-accelerate as a result of higher energy prices during the month. It looks like for the next few months, inflation will probably be bouncing around the three per cent range,” said Royce Mendes, managing director and head of macro strategy at Desjardins.

A rise in inflation will slightly complicate things for the Bank of Canada, which is widely expected to begin cutting its policy interest rate in the …