Canada inflation cools to 40-month low of 2.5% in July
Consumer Price Index was up 0.4% on a monthly basis
Core inflation eased to slowest pace since April 2021
Easing inflation will keep Sept rate cut bets on track
Adds comments, context in paragraphs 4-6; adds graphic
By Promit Mukherjee and Ismail Shakil
OTTAWA, Aug 20 (Reuters) -Canada's annual inflation rate cooled to a 40-month low of 2.5% in July, matching forecasts, and core inflation measures eased as well, data showed on Tuesday, keeping the Bank of Canada on track to cut interest rates again in September.
Analysts polled by Reuters had forecast inflation to cool to 2.5% from 2.7% in June. The consumer price index was up 0.4% on a monthly basis, also in line with forecasts, Statistics Canada data showed.
Money markets expect another 25 basis point cut at the bank's next rate announcement on Sept. 4 and are nearly pricing in a total of three more cuts this year. 0#BOCWATCH
Most economists are also factoring in a similar rate reduction trajectory for the rest of the year, which would bring down the benchmark rate to 3.75% by year-end.
"With inflationary pressures fading away but concerns about the weakening labor market growing, we continue to forecast three further 25bp cuts by the Bank of Canada at the remaining meetings this year," said Andrew Grantham, senior economist at CIBC Capital Markets.
The central bank trimmed its policy rate at its last two consecutive meetings, bringing it down to 4.5% from 5% before the first cut. But at its monetary policy announcement last month, it pivoted from the narrative of only trying to suppress inflation to also boosting the economy.
The inflation rate is now the closest to the Canadian central bank's 2% target since 2.2% inflation in March 2021, when prices were beginning to rise after about a year into the coronavirus pandemic.
The Canadian dollar CAD= pared some gains after the CPI report with the local currency trading up 0.04% to 1.3628 against the U.S. dollar, or 73.38 U.S. cents. Bond yields for the two-year Canadian government bonds CA2YT=RR fell 3.5 basis points to 3.416%.
Two of the Bank of Canada's preferred measures of underlying inflation - CPI-median and CPI-trim - eased to their slowest pace since April 2021. CPI-median slowed to 2.4% from 2.6% in June, while CPI-trim cooled to 2.7% from 2.8%.
The slowdown in headline inflation in July was largely driven by lower prices for travel tours, passenger vehicles and electricity, the statistics agency said.
The slowdown in headline inflation in July was largely driven by lower prices for travel tours, passenger vehicles and electricity, the statistics agency said.
Among the main drivers of deceleration in inflation, prices for travel tours fell 2.8% on an annual basis in July after a 7.4% increase in the month earlier. Passenger vehicles also got cheaper in the month, as prices fell at the fastest rate since November 2012.
Goods prices rose 0.3% annually - same as June - while services inflation slowed to 4.4% from 4.8%.
Canada's inflation and interest rates https://reut.rs/3SV3Ews
Reporting by Ismail Shakil and Dale Smith in Ottawa
Additional reporting by Promit Mukherjee
Editing by Nick Zieminski
免責聲明: XM Group提供線上交易平台的登入和執行服務,允許個人查看和/或使用網站所提供的內容,但不進行任何更改或擴展其服務和訪問權限,並受以下條款與條例約束:(i)條款與條例;(ii)風險提示;(iii)完全免責聲明。網站內部所提供的所有資訊,僅限於一般資訊用途。請注意,我們所有的線上交易平台內容並不構成,也不被視為進入金融市場交易的邀約或邀請 。金融市場交易會對您的投資帶來重大風險。
所有缐上交易平台所發佈的資料,僅適用於教育/資訊類用途,不包含也不應被視爲適用於金融、投資稅或交易相關諮詢和建議,或是交易價格紀錄,或是任何金融商品或非應邀途徑的金融相關優惠的交易邀約或邀請。
本網站的所有XM和第三方所提供的内容,包括意見、新聞、研究、分析、價格其他資訊和第三方網站鏈接,皆爲‘按原狀’,並作爲一般市場評論所提供,而非投資建議。請理解和接受,所有被歸類為投資研究範圍的相關内容,並非爲了促進投資研究獨立性,而根據法律要求所編寫,而是被視爲符合營銷傳播相關法律與法規所編寫的内容。請確保您已詳讀並完全理解我們的非獨立投資研究提示和風險提示資訊,相關詳情請點擊 這裡查看。