Canada Inflation Rate Steady at 1.5% in June

Consumer prices in Canada rose 1.5 percent year-on-year in June of 2016, the same as in the previous month and above market expectations of a 1.4 percent increase. Biggest upward contributions came from prices of shelter, household operations, furnishings and equipment.
Statistics Canada | Joana Taborda | 7/22/2016 1:44:43 PM
The shelter index rose 1.6 percent after increasing 1.4 percent in May. This acceleration was partly attributable to homeowners' replacement cost, which was up more year over year in June (+3.5 percent) than in May (+2.7 percent). Additionally, fuel oil prices were down less on a year-over-year basis in June (-13.2 percent) compared with May (-17.3 percent). The natural gas index posted a larger decline in the 12 months to June than in the previous month.

Food prices were up 1.3 percent, following a 1.8 percent gain in May. Prices for food purchased from stores rose 0.8 percent, as the fresh or frozen beef index (-3.3 percent) registered its first year-over-year decrease since August 2010. Consumers paid 2.1 percent less for dairy products in June compared with the same month a year earlier. Prices for food purchased from restaurants advanced 2.6 percent, matching the rise in May.

The transportation index posted a 1.1 percent year-over-year gain in June, the same increase as in May. The purchase of passenger vehicles index rose 5.6 percent, following a 4.3 percent advance the previous month. This acceleration was partly offset by a larger year-over-year decrease in gasoline prices, down 8.5 percent in June, following a 7.1 percent decline the previous month. The passenger vehicle insurance premiums index was up less year over year in June (+0.2 percent) than in May (+1.2 percent); the deceleration was led by Ontario, where regulatory changes to coverage took effect on June 1, 2016.

On a monthly basis, consumer prices edged up 0.2 percent, following a 0.4 percent rise in May. The food index and the alcoholic beverages and tobacco products index decreased, while cost of recreation, education and reading posted no change.

Annual core inflation came in at 2.1 percent, the same as in May and above market consensus of 2 percent. 

Canada Inflation Rate Steady at 1.5% in June