Canada Inflation March 2016

Canada

Canada: Inflation eases in March

April 22, 2016

In March, seasonally-adjusted consumer prices recorded a 0.2% increase over the previous month, which contrasted February’s 0.2% decrease and marked the highest figure in nine months. According to Statistics Canada, all components of the index increased over the previous month, with the largest rise being for the prices for clothing and footwear.

Inflation was 1.3% in March, down from 1.4% in February. March’s result was slightly above the 1.2% expected by the markets. Despite the decrease, inflation is still within the Bank of Canada’s target range of 2.0% plus/minus 1.0 percentage point. Annual average inflation in March mirrored February’s tally of 1.2%. Core inflation, which excludes volatile items such as gasoline and fresh food, increased from 1.9% in February to 2.1% in March.

The Bank of Canada expects headline inflation to end 2016 at 1.5%, according to its April Monetary Policy Report. For 2017 the Bank expects inflation to close the year at 2.0%. FocusEconomics Consensus Forecast panelists expect inflation to average 1.9% in 2016, which is unchanged from the previous month’s forecast. The panel expects inflation to average 2.0% in 2017.


Author:, Economist

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Canada Inflation March 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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