Canada Inflation Cools as Food Prices Drop
Canada Inflation Cools as Food Prices Drop

Canada Inflation Cools as Food Prices Drop

Canada Inflation Cools as Food Prices Drop

Canada’s inflation rate slowed more than economists forecast in March as food and clothing prices declined. Measures of core prices also sagged, underlining Bank of Canada Governor Stephen Poloz’s concern that excess slack remains in the economy.
The consumer price index rose 1.6% in March from a year ago compared with a rate of 2% the prior month, Statistics Canada said Friday from Ottawa. Economists surveyed by Bloomberg forecast the rate would rise 1.8%.
Prices rose 0.2% on a monthly basis, lagging the 0.4% median economist forecast. The average of the Bank of Canada’s three core inflation measures was 1.5%, and the February average was revised down to 1.5% from 1.6%.
The ‘common’ core rate was 1.3% in March, the ‘median’ core rate was 1.7% and the ‘trim’ measure was 1.4%. The median core measure was revised for February to 1.8% from 1.9%, and trim was revised to 1.5% from 1.6%.
Bank of Canada policymakers said April 12 core inflation measures have been “drifting down in recent quarters” and along with slow wage growth was consistent with “material excess capacity in the economy.”
Poloz pointed to those indicators to say the bank needs more sustained evidence to be confident the recovery is on a firm footing. The governor also said the US economy is further along than Canada’s. That hasn’t stopped some private economists from advancing predictions for a rate hike next year, as output and jobs pick up.
“It fits their narrative, and this notion there is no rush to hike,” at the central bank, Jimmy Jean, a strategist in the fixed-income group at Desjardins Capital Markets in Montreal, said by phone. “That neutral stance can be expected to be kept for some time.”
Another economist, Derek Holt, of Scotiabank, said: “Generally speaking, I think it leans in the direction of a neutral, dovish central bank not a neutral, hawkish central bank. We’ve lost the temporary fillip that we got from a year ago base effects and energy prices on headline. Now that’s shaking out."
Food prices fell for a sixth straight month, with a 1.9% decline for March. Gasoline price gains moderated, with a 15.2% March gain following February’s 23.1% jump. Clothing and footwear prices swung to a 0.9% decline in March, from a gain of the same magnitude the prior month. And transportation costs were a main driver of inflation in March, even as the pace of price gains slowed to 4.6% from 6.6%.

Short URL : https://goo.gl/jOfxrq
  1. https://goo.gl/PRgYSd
  • https://goo.gl/x6yKXY
  • https://goo.gl/9j1X4J
  • https://goo.gl/t39Qgx
  • https://goo.gl/5Fo3yI

You can also read ...

Saudi Arabia Bleeds as Capital Flight Continues
As Saudi Arabia raises the stakes in its dispute with Canada...
Experts Say China Economy Manageable
Recent external pressures, a general global trade malaise...
Europe Should Resist Illegal US Penalties
European countries should take effective steps to counter US...
Qatar Pledges $15b Investment :      Turkish Lira Weakens 6% on Threat of More US Sanctions
Turkey’s battered lira weakened more than 6% against the...
 Final Nail in Abraaj Coffin
The Abraaj Group has been put through the ringer in past...
Australia Drought Could Cost $12 Billion
The Reserve Bank of Australia and a new report have warned of...
Indonesia Sets Moderate Growth Goals
Amid rising external pressures, Indonesia’s economy is...
 Crypto Scams on the Rise in UK
Crypto currency scams are using images of celebrities and...

Add new comment

Read our comment policy before posting your viewpoints