Canada: Inflation hits six-year high in June
July 20, 2018
Seasonally-adjusted consumer prices rose 0.1% from a month earlier in June, matching May’s increase. According to Statistics Canada, the rise was driven by higher food and shelter prices. On the other hand, utilities prices fell.
Inflation jumped to a six-year high of 2.5% in June (May: 2.2%), a notch above market expectations. June’s reading saw higher prices across nearly all categories and was driven by the faster rise of fuel costs. Meanwhile, annual average inflation ticked up to 1.9%, the highest level in three years, from 1.8% in May. Core inflation, which excludes volatile items including fuels and fresh produce, was stable from May at 1.3%.
Canada Inflation Forecast
In its July monetary policy report, the Bank of Canada forecast inflation averaging 2.4% in 2018 and 2.2% in 2019. FocusEconomics Consensus Forecast analysts see inflation averaging 2.2% in 2018, which is up 0.1 percentage points from last month’s forecast. For 2019, our panelists see inflation averaging 2.0%.
Author: Christopher Thomas, Economist