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Economic news
21.05.2024

Canada’s annual inflation decelerates to 2.7 per cent in April, matching expectations

Statistics Canada announced on Tuesday the country’s consumer price index (CPI) increased 0.5 per cent m-o-m in April, following an unrevised 0.6 per cent m-o-m jump in the previous month. This represented the third straight monthly advance in CPI.

On a y-o-y basis, however, Canada’s inflation rate demonstrated a 2.7 per cent gain last month, decelerating from an unrevised 2.9 per cent in March. This marked the lowest annual inflation rate since March 2021 (+2.2 per cent).

Economists had forecast inflation would increase by 0.5 per cent m-o-m and 2.7 per cent y-o-y in April.

According to the report, the April broad-based deceleration in the headline annual inflation rate was led by food prices, services and durable goods. Meanwhile, gasoline prices, which rose at a quicker pace in April (+6.1 per cent y-o-y) than in March (+4.5 per cent y-o-y) slightly moderated this slowdown.

The trimmed-mean CPI – the preferred measure of core inflation of the Bank of Canada - soared 2.9 per cent y-o-y in April, following an upwardly revised 3.2 per cent y-o-y surge (from +3.1 per cent y-o-y) in March. This was the weakest annual gain since July 2021 (+3.1 per cent y-o-y). Economists had predicted an increase of 2.9 per cent y-o-y.

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