CA Trimmed CPI y/y

Canadian consumer prices fell a greater-than-expected 0.4% in June, cutting the yearly inflation rate to 2.8% y/y. Note that June usually sees some decline in prices, leaving the seasonally-adjusted monthly change at flat. A 10.2% drop in gasoline prices weighed heavily on the headline, but there was softness elsewhere as well. It wasn't all weakness though, as the World Cup had some impact with hotel costs climbing more than normal in the month, though that suggests we'll get some reversal in the next couple of months. In a welcome ...

The US dollar fell against all of the G10 currencies last week but the Japanese yen. The softer than expected US CPI and PPI saw the US two-year yield fell by nearly eight basis points. As we show below, in current context, several of the dollar pairs are very sensitive to the changes in short-term US rates, or the like Canadian dollar, the two-year rate differential. Still, as the Middle East war re-escalated, the greenback seemed to catch a safe haven bid. In addition, the pressure on equities, especially in the Ai and tech sector ...

This note was delayed by marketing demands but I think it’s worth advancing a thesis I don’t see well covered. We now have three reports that provide convincing evidence that a temporary soft patch on underlying inflation is being left behind. Core inflation measures picked up in May and their three-month moving averages are restoring above-2% momentum in price pressures at the margin. See charts 1–3. charts Key are the m/m annualized and seasonally adjusted (SAAR) trimmed mean and weighted median CPI measures. They provide ...

Canada's consumer prices rose 1.0% in May, lifting the headline inflation rate four ticks to 3.2%, above expectations and the highest since late 2023. A variety of food prices and travel-related costs added to the predictable jump in pump prices to drive this monthly rise, as ex-gasoline inflation picked up two ticks to 2.2%. But that's pretty much where the bad news ends, as the Bank's two main measures of core were unchanged at right around 2%, and we know that gasoline prices are on track for about a 10% drop in June, which should ...

The trading week has not been entirely favorable for the Canadian dollar in the short term, as USD/CAD has shown upward strength over the last three sessions, with a gain of around 0.3%. This indicates that US dollar strength is becoming increasingly present in the pair’s recent price action. For now, buying pressure has managed to hold despite the release of Canadian CPI data, mainly because the strength of US Treasury bonds continues to support the US dollar. If this catalyst remains in place, buying pressure around USD/CAD could ...

Yes, Canadian consumer prices rose 0.4% in April (or 0.3% in s.a. terms), lifting the headline inflation rate to 2.8% from 2.4% the prior month. The bump was driven by an 8.9% jump in gasoline prices, which we all saw coming a mile away. But the real story in today's release was how would all other prices respond to the spike in energy costs, and the news there was much better than expected. Before digging into all the messy details, one only needs to know that CPI excluding gasoline was up precisely 2.0% from a year ago, so any ...