UPDATE 1-Canada annual inflation cools in Jan as gasoline, car costs ease

(Adds details from report)

OTTAWA, Feb 23 (Reuters) - Canada's annual inflation rate pulled back in January as consumers paid less for gasoline and vehicles, offsetting a pick-up in the cost of food, while underlying inflation firmed, data from Statistics Canada showed on Friday.

The annual inflation rate was 1.7 percent last month, down from 1.9 percent in December and above economists' forecasts for 1.4 percent.

The measure moved further away from the Bank of Canada's 2 percent target. But the bank's three measures of core inflation were less muted, with CPI common, which the central bank says is the best gauge of the economy's underperformance, rising to 1.8 percent, the highest since April 2012.

Transportation costs rose 3.2 percent from a year ago, moderating from the previous month's 4.9 percent annual pace as price gains for gasoline and autos decelerated.

But food prices were up 2.3 percent, the largest gain since April 2016, as Canadians paid more for food at restaurants as well as fresh fruits and vegetables.

Rounding out the three measures of core inflation, CPI median, which shows the median inflation rate across CPI components, held at 1.9 percent, while CPI trim, which excludes upside and downside outliers, was unchanged at 1.8 percent after December was revised down.

(Reporting by Leah Schnurr; Editing by Jeffrey Benkoe)