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Canada's inflation rate eases in December

The increase in Canada's cost of living hit its lowest level in two years last month as falling energy prices continued to drive annual inflation closer to zero.

Statistics Canada said annual inflation dipped to 1.2 percent in December, a level not seen since January 2007, and almost a full point below November's 2 percent rate.

On a month-to-month basis, prices were generally 0.7 percent lower last month than they were in November.

"Canadian headline inflation is poised to drop further in the coming months, with an eventual short-term trip into negative inflation terrain ahead," said Douglas Porter, a senior economist with BMO Capital …