Canada June Inflation Rate at Over 6-Year High



Canada's consumer price inflation rose to 2.5 percent year-on-year in June 2018 from 2.2 percent in the previous month, and above market expectations of 2.4 percent. It was the highest rate since February 2012, mainly driven by higher prices for gasoline and food purchased from restaurants.

Transportation prices jumped 6.6 percent in June (vs 5.6 percent in May), driven by higher energy costs (12.4 percent vs 11.6 percent) particularly gasoline (24.6 percent vs 22.9 percent) as sustained increases in crude oil prices and exchange rate pressures continued to impact consumer prices. Additional upward pressure came from: food (1.4 percent vs 1 percent); shelter (2 percent, the same as in May); recreation, education and reading (0.6 percent vs 1.7 percent); clothing and footwear (1.8 percent vs 0.8 percent); health and personal care (1.5 percent, the same as in May); and alcoholic beverages and tobacco products (4.8 percent vs 4.6 percent).

Meanwhile, prices of household operations, furnishings and equipment edged down 0.1 percent in June, after a 0.3 percent gain in May.

On a seasonally adjusted monthly basis, the CPI rose 0.1 percent in June, the same pace as in May and matching market consensus. Six of eight major components increased: food (0.6 percent); clothing and footwear (0.5 percent); alcoholic beverages and tobacco products (0.5 percent); health and personal care (0.2 percent); shelter (0.1 percent); and transportation (0.1 percent). By contrast, a decline was seen in prices of recreation, education and reading (-0.6 percent) and household operations, furnishings and equipment (-0.3 percent).

The BoC's annual core inflation, which excludes volatile items, stood at 1.3 percent in June, unchanged from the May's rate and below market expectations of 1.4 percent.

Canada June Inflation Rate at Over 6-Year High


Statistics Canada | Joana Ferreira | joana.ferreira@tradingeconomics.com
7/20/2018 1:26:42 PM