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Canada’s main stock index fell on Wednesday as a drop in oil and gold prices hit commodity stocks, while data showed inflation accelerated again in June but not as sharply as expected.

At 10:10 a.m., the Toronto Stock Exchange’s S&P/TSX composite index was down 54.24 points, or 0.29%, at 18,883.47.

Energy stocks fell 0.7% as oil prices dropped ahead of an expected buildup in U.S. crude inventories, while material stocks declined 0.9% tracking a fall in gold prices due to a stronger dollar.

Data earlier in the day showed Canada’s annual inflation rate accelerated to 8.1% last month, up from 7.7% in May, mainly on rising gasoline prices.

But the figure was slightly below market expectations and eased fears of another aggressive move from the central bank after it raised interest rates by 100 basis points last week in a surprise move.

While expectations for a 50-basis-point hike increased slightly after the data, traders were now seeing a smaller chance of a 75-basis-point raise.

“The market is soaking it in and accepting that we’ve seen the worst,” said Lorne Steinberg, president of Lorne Steinberg Wealth Management Inc.

“Inflation could probably peak this month, next month or September and then it’ll lighten up a little bit, but we’re not going to see the big decline until 2023. From a central bank standpoint, it’s hard to imagine rates increasing a lot from here because of the impact on the consumer and probably no need to as these rate increases filter through the economy.”

The rate-sensitive financials sector slipped 0.3%.

Some analysts, meanwhile, said some Canadian businesses were reconsidering their expansion plans after the last week’s jumbo rate hike to protect profits.

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