However,
Inflation 1.9% canada 2.2% quebec:
Statistics Canada announced Tuesday that the consumer price index increased by 1.9 % from one year to June in Canada, which represents an acceleration compared to the annual increase of 1.7 % observed in May, which is largely in line with economists’ expectations.
The Federal Agency stressed that the consumer price index has increased at a higher rate in eight provinces. Consequently, In Quebec, annual inflation was 2.2 % last month, after being 1.7 % in May.
Pump prices did not drop much last month. Moreover, according to the agency, and the price increase in motor vehicles and other durable goods also fueled inflation.
In addition. For example, the underlying inflation indicators, closely monitored by the Bank of Canada, remained around 3 % in June, which is “a little too high” for the taste of the central bank, said Doug Porter, chief economist inflation 1.9% canada 2.2% quebec of the BMO, during an interview.
The economy seems to resist the weight of the trade war between Canada. However, the United States, he explained, which means that consumers continue to spend and that companies do not hesitate to increase their prices.
“One of the reasons why the underlying inflation remains relatively strong is that. Similarly, yes, the economy has been a little more resilient than many hoped, in my opinion,” said Mr. Furthermore, Porter.
What impact on rates?
Data for the month of June constitute the last overview that the Bank of Canada will collect before its. Therefore, next decision on interest rates on July 30.
The central bank maintained its key rate at 2.75 % in two consecutive decisions, and Mr. Furthermore, Porter agreed that he did not see any reasons to change position.
“The Bank of Canada has remained withdrawn during its last two meetings. Furthermore, It inflation 1.9% canada 2.2% quebec now seems that she will stay there again at the end of July. and this is simply explained by the fact that the underlying inflation has proven to be too strong for his taste, “he said.
The latest inflation figures occur a few days after Statistics Canada announced an unexpected increase of 83. 000 jobs in June, sufficient to slightly lower the unemployment rate to 6.9 %.
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Stephen Brown. deputy chief economist for North America at Capital Economics, said in an interview that the last inflation report hardly changed the central bank speech after the publication of a surprisingly solid employment report last week.
“This high increase in employment suggests that the effects of customs duties do not cause significant damage to the economy so far. means that, even if the inflation 1.9% canada 2.2% quebec bank considers that a slight drop in the key rate could possibly be beneficial, it does not need to rush,” he explained.
The probability of a decrease of a quarter rate later this month fell to just over 5 % Tuesday afternoon. according to LSEG Data & Analytics, against a little more than 13 % before the publication of the consumer price index.
Brown said Capital Economics still anticipated two drops of a quarter rate at the Decisions of the Bank of Canada in September. December. However, he pointed out that confidence fogged with the drop announced in September.
Ali Jaffery. CIBC’s main economist, said that the Banque du Canada will maintain its master rate at its current level at the end of the month.
“Waiting for the fall will give them more time to observe pressure on costs. the reaction of the economy to customs duties and the shock inflation 1.9% canada 2.2% quebec of uncertainty, and above all, to have a more precise idea of the impact of customs duties in Canada,” he explained in a note to its customers.
Inflation 1.9% canada 2.2% quebec
A slight increase in prices
Mr. Porter said that the consumer price index had recorded a more marked drop in prices from May to June last year. but that the variations of last month were less encouraging.
Economists call this the effect of the reference year: the data trend of the previous year to distort the. annual comparisons of the consumer price index.
“In reality, we only noticed a slight increase in prices in June, but it was just enough (…) to increase overall inflation,” he added.
According to the Federal Agency. gasoline prices remained practically unchanged in June, the rise in crude oil prices and geopolitical conflicts that accentuated pressure to the pump. Motorists have found a faster inflation 1.9% canada 2.2% quebec drop in prices at the same period last year. which, according to the agency, has fueled an increase in overall inflation.
By excluding energy, annual inflation was 2.7 % in June. The abolition of federal carbon pricing on consumption, at the beginning of April, continues to weigh on annual price comparisons.
Statistics Canada invoked customs duties to explain the rise in clothing. shoes prices in June.
The prices of motor vehicles displayed an increase of 4.1 %, compared to 3.2 % in May. The prices of second -hand vehicles experienced their first increase from one year to 18 months in 18 months. while stocks were more limited.
Although customs duties on motor vehicles are at the heart of the trade conflict between Canada. the United States, Mr. Brown invited that it was not certain that vehicles are only influenced by customs duties.
The inflation 1.9% canada 2.2% quebec weakness of the exchange rate between the Huard. the US dollar at the start of the year probably continues to influence prices, he added, and data from the United States consumer price index for June does not reflect the cost of vehicle cost in Canada.
The annual increase in food prices slowed down slightly, from 3.4 % in May to 2.9 % in June. Statistics Canada noted that this slowdown is largely attributable to the prices of fresh vegetables, which decreased by 3.1 % over a year.
The inflation of housing prices continued to slow down, falling from a tenth of a percentage point to stand at 2.9 % in June.
Furniture prices increased faster in June, under the effect of a general acceleration of the prices of lasting goods.
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Inflation 1.9% canada 2.2% quebec
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