FT article of interest - Canadian Inflation biggest monthly drop since start of Covid20 Sep 2022 20:18
Encouraging
‘Consumer prices in Canada recorded their biggest monthly drop since the start of the pandemic, potentially easing pressure for further big interest rate increases from the country’s central bank.
The consumer price index fell 0.3 per cent in August, Statistics Canada said on Tuesday, following July’s 0.1 per cent increase. This marked the biggest monthly decline since April 2020, and compared with economists’ expectations for a 0.1 per cent decrease.
That helped bring the annual increase in CPI to 7 per cent in August, down from 7.6 per cent in July, marking a further slowing from the 40-year high of 8.1 per cent in June. Economists expected an annual pace of 7.3 per cent.
A moderation in price growth for petrol, transportation and housing drove helped slow inflation in August. Petrol prices fell 9.6 per cent on a monthly basis, the largest monthly decline since April 2020, but were still up 22.1 per cent from a year ago.
Food prices were still higher than a year ago, due to factors including extreme weather and supply chain disruptions. Statistics Canada singled out a 10.8 per cent increase in grocery prices, the fastest pace in the country since 1981.
Stripping out volatile food and energy prices, the so-called core CPI registered no monthly increase in July, helping lower the annual pace of core inflation to a four-month low of 5.8 per
Canada’s central bank has raised its policy interest rate by 3 percentage points since the start of this year to combat soaring inflation. The current policy rate of 3.25 per cent is now in so-called restrictive territory, wherein the central bank is explicitly targeting a slowing of the economy’
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