September 17, 2024 12:30 GMT
Canada Aug CPI Back To BOC Target +2% YOY, Slowest Since Feb 2021
CANADA DATA
- Canada August CPI eases back to BOC's target at +2% YOY, slowest since February 2021. That is below the +2.1% forecast. Month-on-month -0.2%, better than +0.0% expected.
- BOC preferred core measures remained at slowest pace since April 2021, median +2.3% and trim +2.4%.
- Headline deceleration was due in part to lower prices for gasoline, due to a combination of lower prices and a base-year effect. Excluding gasoline, the CPI rose 2.2% in August, down from 2.5% in July.
- The increase in CPI was led by mortgage interest cost and rent, which slowed down but remained elevated. Mortgage interest costs rose at a slower pace for the 12th straight month, up 19%.
- Clothing and footwear prices dropped MOM in August for the first time since 1971, -0.6% MOM, the month associated with back-to-school shopping.
- BOC has said that more interest rate cuts could be justified if inflation continues to ease. At least a 25 bps cut is expected in the next BOC rate decision on October 23.
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