MNI 5 THINGS: Canada March CPI Picks Up, Core Stable>

--Goods Inflation +1.8% Y/Y, Highest Since Nov 2011

--Services Inflation +2.7% Y/Y, Highest Since Sept 2011

By Yali N'Diaye

     OTTAWA (MNI) - The following are the key points from the March data 

on the Canadian Consumer Price Index released Friday by Statistics 

Canada: 

     - Headline unadjusted CPI rose 0.3% in March, a slowdown from the 

0.6% recorded in February, and slightly below the 0.4% gain expected by 

analysts in a MNI survey. Travel tours (+13.0%) and gas prices (+2.9%) 

were the main contributors. Adjusted CPI rose 0.1% on the month, and 

0.2% excluding food and energy. 

     - Year-over-year CPI increased to 2.3% from 2.2% in February, the 

highest rate since October 2014, drifting further away from the Bank of 

Canada's 2.0% target. Analysts surveyed by MNI had expected a 2.5% 

increase. 

     - A 17.1% gain in gasoline prices was the largest upward 

contributor to the year-over-year CPI increase. Excluding gas prices, 

the 12-month inflation rate was 1.8% in March, the same as February. CPI 

excluding energy was up 1.9%. Excluding food and energy, it also 

increased 1.9%. Goods inflation picked up to 1.8% from 1.7%, with gas 

prices being the main contributor (non-durable goods inflation was 

+3.0%, the highest since October 2014). Services inflation was 2.7%, the 

highest since September 2011, boosted by food purchased at restaurants, 

which might be affected by minimum wage increases. 

     - Core inflation stabilized, with the range of the three BOC 

preferred measures of underlying inflation remaining at 1.9%-2.1%. Both 

CPI-common (1.9%) and CPI-median (2.1%) were stable, while CPI-trim 

edged down to 2.0% from 2.1%. 

     - The BOC has already factored in a pick up in total inflation 

above the 2.0% target, meaning Friday's data should not affect its 

thinking. In fact, inflation came in at 2.1% in the first quarter, 

matching the BOC's latest projection released Wednesday. The central 

bank expects a further pick up in the second quarter to 2.3%. 

--MNI Ottawa Bureau; email: yali.ndiaye@marketnews.com 

[TOPICS: M$C$$$,MACDS$]