Canada Inflation Rate At 3-Month Low Of 1.2%


Consumer prices in Canada increased 1.2 percent year-on-year in November of 2016, following a 1.5 percent rise in October and below market estimates of 1.4 percent. It was the lowest inflation rate since August, as cost dropped for food, clothing and footwear, and transport prices rose at a slower pace. On a monthly basis, prices fell 0.4 percent.

Year-on-year, transport cost rose 1.4 percent, following a 3 percent gain in October: gasoline prices went down 1.7 percent after increasing 2.5 percent and purchase of passenger vehicles rose less (+3 percent compared to 4.4 percent) but remained the top upward contributor to the 12-month change in the transportation index.

The clothing and footwear prices were down 1.2 percent, led by a 6.5 percent decline in children's clothing. The jewellery index posted its largest decline since April 1997, down 3 percent, after rising 4 percent in October.

Food prices went down 0.7 percent, matching the decline in October. Prices for food purchased from stores declined 2 percent, with the fresh vegetables, meat, and fresh fruit indexes contributing the most to the decline. In contrast, the fish, seafood and other marine products index and the non-alcoholic beverages index posted gains. Prices for food purchased from restaurants were up 2.5 percent, following a 2.6 percent increase in October.

The shelter index rose 2.1 percent, after 1.9 percent growth in October. Homeowners' replacement cost contributed the most to this gain, rising 4.4 percent. Electricity prices remained a principal upward contributor, despite a deceleration in price growth, up 3.5 percent, following a 5.3 percent increase in October. The natural gas index (-0.2 percent) recorded its smallest year-over-year decline since an increase in March 2015.

On a monthly basis, consumer prices fell 0.4 percent after edging up 0.2 percent in October.

Excluding food and energy, consumer prices fell 0.5 percent on the month and rose 1.5 percent on the year.

Statistics Canada | Yekaterina Guchshina | yekaterina@tradingeconomics.com
12/22/2016 1:57:27 PM