Statistics
Canada reported on Tuesday the country’s consumer price index (CPI) rose 0.4
per cent m-o-m in July, following
an unrevised 0.1 per cent m-o-m slip in the previous month.
On a y-o-y
basis, Canada’s inflation rate demonstrated a 2.5 per cent rise last month, decelerating from an
unrevised 2.7 per cent in June. This was the lowest annual
inflation rate since March 2021
(+2.2 per cent). Economists had expected that inflation would increase by 0.4 per cent m-o-m and 2.5 per cent y-o-y in July.
According to
the report, the July slowdown in the headline annual inflation was broad-based,
stemming from lower prices for travel tours (-2.8 per cent y-o-y in July compared to +7.4 per cent y-o-y in
June), passenger vehicles (-1.4 per cent y-o-y compared to -0.4 per cent y-o-y
in June) and electricity (-0.8 per cent y-o-y compared to +2.4 per cent y-o-y
in June).
Meanwhile, the monthly
gain in inflation was driven by a climb in gasoline prices (+2.4 per cent m-o-m
compared to -3.1 per cent m-o-m in June).
The trimmed-mean
CPI – the preferred measure of core inflation of the Bank of Canada - increased
2.7 per cent y-o-y in July, following a downwardly revised 2.8 per cent y-o-y soar
(from +2.9 per cent y-o-y) in June. This marked the weakest annual advance
since June 2021 (+2.7 per cent y-o-y). Economists had foreseen
a rise of 2.8 per cent y-o-y.