Canadians caught a slight break on inflation in January, when energy prices appreciated less sharply than they did in the previous month.

Statistics Canada reported Friday that the annual inflation rate was 2.3 per cent in January, a drop of one-tenth of a point from December.

The statistics agency said that energy costs were the major force driving inflation, though the impact on consumers was less severe in January than it was the previous month.

StatsCan said that Canadians spent 9 per cent more on energy costs than they did a year ago. That was a drop from December, when they were spending 10.5 per cent more than they did the previous holiday season.

Gasoline prices continue to rise in January, with Canadians paying 13 per more to fill up their vehicles than they did a year before.

Along with energy costs, StatsCan reported that rising transportation and shelter costs contributed to the annual inflation rate sitting above the Bank of Canada's target two-per-cent level. Higher restaurant costs were also a factor.

Food prices could press inflation higher

Food prices have also been on the rise in Canada over the past 12 months, with consumers paying 4 per cent more for meat and 10.7 per cent more for sugar and confectionary items in January than they did a year ago. But overall, food prices have only appreciated by 2.1 per cent in the past year.

Following the release of the inflation figures on Friday, a Capital Economics news release predicted that "it is just a matter of time" before rising agricultural commodity prices will push Canadian inflation upwards.

The economic forecaster predicted that Canadian inflation could hit 3.0 per cent by mid-2011.

Also in January, clothing and footwear prices were 2.4 per cent below what they were a year before. Women and children, in particular, paid less for what they were wearing.

The prices consumers paid for computer equipment, related supplies and video equipment also fell.

Despite the rise in annual inflation, StatsCan said that core inflation -- a measure that excludes volatile components such as energy -- was only 1.4 per cent in January.

On a provincial basis, Ontario saw the highest jump in consumer prices in January, with Ontarians paying 2.9 per cent more than they did 12 months before. Alberta had the smallest increase, at 1 per cent.

With files from The Canadian Press