Inflation in Canada
Canada - Inflation
Inflation hits the midpoint of the Central Bank’s target range in April
Consumer prices increased a seasonally-adjusted 0.3% from a month earlier in April, down from March’s revised 0.4% rise (previously reported: +0.3% month-on-month). According to Statistics Canada, the uptick was mostly driven by higher prices for transportation due to a jump in gasoline prices.
Inflation notched up to 2.0% in April (March: 1.9%), as analysts had projected, and hit the midpoint of the Central Bank’s target range of 1.0% to 3.0%. Meanwhile, annual average inflation edged lower to 2.1% in April, down from the 2.2% registered in March. Core inflation, which excludes volatile items such as fuels and fresh produce, inched up to 2.0% in April (March: 1.9%).
A carbon tax, which was introduced by the federal government in April, was chiefly behind this month’s inflation uptick and should keep prices elevated in the near-term. Moreover, a tight labor market following April’s solid job creation and robust wage growth will likely add further upward price pressures going forward.
Providing a short-term outlook on inflation, Avery Shenfeld, chief economist at CIBC World Markets, noted:
“Inflation in Canada is just a steady as she goes story, and she goes right in line with the Bank of Canada’s target. That's true for the headline 2.0% rate, and nearly so for the three core measures that average only a tick lower at 1.9%. There's nothing for markets to really chew on today, with the date essentially bang on expectations, and with the headline figure only a tick higher than the prior month and showing no obvious trend. Ex-gasoline inflation is at 2.3%, underscoring our view that in upcoming quarters we're likely to see a period in which inflation runs above 2% for a while when we move past year-on-year declines in pump prices.”
In its April monetary policy report, the Bank of Canada projected inflation averaging 1.9% in 2019 and 2.0% in 2020. Met the why particular Consensus Forecast analysts, meanwhile, see inflation averaging 1.8% in 2019, which is unchanged from the previous forecast. For 2020, our panelists see inflation averaging 2.0%. A new Met the why particular Consensus Forecast will be published 28 May.
Canada - Inflation Data
|Inflation Rate (CPI, annual variation in %)||0.9||1.9||1.1||1.4||1.6|
5 years of economic forecasts for more than 30 economic indicators.
Canada Inflation Chart
Source: Statistics Canada.
|Bond Yield||1.73||1.00 %||May 11|
|Exchange Rate||1.35||0.15 %||May 13|
|Stock Market||16,193||0.23 %||May 13|
Get a sample report showing our regional, country and commodities data and analysis.
Request a Trial
Start working with the reports used by the world’s major financial institutions, multinational enterprises & government agencies now. Click on the button below to get started.
May 15, 2019
Consumer prices increased a seasonally-adjusted 0.3% from a month earlier in April, down from March’s revised 0.4% rise (previously reported: +0.3% month-on-month).
May 14, 2019
House prices were virtually stable on a seasonally-adjusted monthly basis in April, according to the Teranet-National Bank Composite House Price Index (March: -0.3%).
May 8, 2019
Housing starts on a seasonally-adjusted (SAAR) basis surged to 235,460 units in April, according to the Canada Mortgage and Housing Corporation (CMHC).
May 1, 2019
In April, the IHS Markit Manufacturing Purchasing Manager’s Index (PMI) fell to 49.7 from 50.5 a month earlier.
April 30, 2019
The economy shrank 0.1% month-on-month in February, contrasting January’s 0.3% expansion and missing analysts’ expectations of a flat reading.