Canada Inflation Rate Eases to 1.4% in February


Consumer prices in Canada increased by 1.4 percent year-on-year in February of 2016, slowing from a 14-month high of 2 percent in the previous month while missing market expectations of 1.5 percent growth. Cost of food and shelter continued to rise, but a sharp fall in prices for gasoline dragged inflation down.

Year-on-year, consumers paid 3.9 percent more for food following a 4 percent growth in January, with prices for food purchased from stores increasing 4.4 percent and prices for food purchased from restaurants rose 2.7 percent.

The shelter index grew 1.2 percent, accelerating from 1.1 percent rise in the previous month and the household operations, furnishings and equipment index rose 1.8 percent after increasing 1.7 percent. 

In contrast, the transportation index decreased 0.5 percent, following a 2.2 percent increase the previous month. This turnaround was mainly attributable to a 13.1 percent decline in gasoline prices compared to a 2.1 percent growth in January. The purchase of passenger vehicles index, however, was up 5 percent, its largest gain since September 2010.

The clothing and footwear index was down 1.3 percent, after posting a 0.3 percent decrease in January. This larger decline was mainly attributable to the women's clothing index, which was down more in the 12 months to February (-2.9 percent) than in January (-0.8 percent). At the same time, consumers paid more for jewellery in February compared with the same month a year earlier.

The annual core inflation rate was 1.9 percent, down from 2 percent the previous month.

On a monthly basis, consumer prices rose 0.2 percent, the same pace as in the previous month.

Canada Inflation Rate Eases to 1.4% in February


Statistics Canada | Joana Ferreira | joana.ferreira@tradingeconomics.com
3/18/2016 1:00:34 PM