(Adds details from report)
OTTAWA, Aug 21 (Reuters) - Canada's annual inflation rate rose in July as higher prices for food and clothing offset the moderating effect of cheaper energy, data from Statistics Canada showed on Friday.
Annual inflation was 1.3 percent in July, up from 1 percent in June and a tad shy of economists' expectations for 1.4 percent. It was the highest level since last December.
Core inflation, which strips out volatile items and is closely watched by the Bank of Canada, was firmer, rising to 2.4 percent from 2.3 percent, as forecast.
The Bank of Canada has cut interest rates twice this year to prop up the struggling economy and sees the effects of a weaker currency and some sector-specific factors as temporarily boosting the core rate.
On a year-over-year basis, prices were up in seven of the eight major components of the main index, led by a 3.2 percent increase in food as meat prices jumped 6.1 percent.
Clothing and footwear were up 1.3 percent.
While energy and gasoline prices continued to fall, the declines were not as steep. The gasoline index tumbled 12.2 percent, moderating from the previous month's 14.1 percent drop. (Reporting by Leah Schnurr)