Canada Inflation September 2016

Canada

Canada: Inflation accelerates in September

In September, seasonally-adjusted consumer prices increased 0.2% from the previous month, which contrasted the 0.1% decrease recorded in August and marked the highest print in three months. According to Statistics Canada, prices rose for four of the eight major components that make up the index, while three declined. The shelter index remained unchanged. The print mainly reflected an increase in the price of the recreation, education and reading category.

Inflation edged up to 1.3% in September from 1.1% in August. September’s result was below market expectations of a 1.4% rise and remains within the Bank of Canada’s target range of 2.0% plus/minus 1.0 percentage point. Annual average inflation in September matched August’s 1.4%. Core inflation, which excludes volatile items such as gasoline and fresh food, also matched August’s reading of 1.8% in September.

The Bank of Canada expects headline inflation to end 2016 at 1.7%, according to its October Monetary Policy Report. For 2017, the Bank expects inflation to close the year at 2.0%. FocusEconomics Consensus Forecast panelists expect inflation to average 1.6% in 2016, which is unchanged from the previous month’s forecast. The panel expects inflation to increase and average 2.0% in 2017, which is also unchanged from last month’s Consensus forecast.


Author:, Economist

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Canada Inflation September 2016

Note: Year-on-year and month-on-month variation of seasonally adjusted consumer price index in %.
Source: Statistics Canada (SC).


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