Canada: Inflation falls in November
December 19, 2014
In November, consumer prices fell a seasonally-adjusted 0.2% over the previous month, which contrasted the 0.1% increase recorded in October. According to Statistics Canada, lower prices were recorded in two of the eight major components of the index, with the largest price decrease recorded in the index for transportation.
Annual headline inflation in November decelerated, falling from 2.4% in October to 2.0%. The figure marked the lowest inflation rate in eight months and undershot market expectations of 2.4%. According to Statistics Canada, the decrease was largely due to falling gasoline prices. Inflation is well anchored within the Central Bank’s tolerance margin of plus/minus 1.0 percentage points around its target of 2.0%. Annual average inflation continued on an upward trend and inched up from 1.8% in October to 1.9% in November, which represented a 26-month high. Annual core inflation, which excludes volatile items such as gasoline and fresh food, fell to 2.1% from October’s 2.3% figure.