Canadian inflation accelerated slightly in October on the back of higher costs for cars, but underlying price pressures remained around the central bank’s target.

The consumer price index recorded a faster-than-expected annual pace of 2.4 per cent during the month, up from 2.2 per cent in September, Statistics Canada reported Friday from Ottawa. Core measures of inflation -- seen as a better gauge of pressures -- rose to an average of 2 per cent in October from a downwardly revised 1.9 per cent a month earlier.

The numbers are moderate enough to reassure policy makers the picture remains benign despite a spike in gasoline prices earlier this year. The 2 per cent core rate is consistent with an economy at full capacity -- but not one that is overheating. This gives the Bank of Canada scope to proceed with caution on further interest-rate increases.

In its most recent forecasts in October, the Bank of Canada had estimated inflation would average 2.3 per cent in the fourth quarter, down from 2.7 per cent in the second quarter, and would return back to near the 2 per cent target by 2019.

Inflation had reached 3 per cent in July -- the highest in seven years -- on the back of higher gasoline prices, prompting some concern rates would need to rise more quickly. But throughout, the central bank stressed the increase was temporary.

The core rate has hovered around 2 per cent all year.

While gasoline prices remain 12 per cent above year-ago levels, they have now dropped in three consecutive months. They were down 3.2 per cent in October.

The gain in prices last month was led by a 2.6 per cent increase in cars, a 3.1 per cent climb in telephone services and a 4.6 rise in air transportation.

Economists had expected annual inflation would remain unchanged at 2.2 per cent in October.

Other CPI Highlights:

-Monthly inflation was up 0.3 per cent in October, faster than the economist forecast of 0.1 per cent
-On a seasonally adjusted basis, inflation was also up 0.3 per cent
-Two of three measures of core inflation increased. The “common” rate was unchanged at 1.9 per cent, the “median” increased to 2.0 per cent from a downwardly revised 1.9 per cent in September and the “trim” rate rose to 2.1 per cent from a revised 2.0 per cent
-Inflation for services in October was 2.7 per cent, up from 2.5 per cent in September

--With assistance from Erik Hertzberg.