Wednesday, April 17, 2019 - 08:48

MNI DATA IMPACT: Canada March CPI +1.9% Y/Y, Core Picks Up

By Yali N'Diaye

OTTAWA (MNI) - The following are the key points from the March data on the Canadian CPI released Wednesday by Statistics Canada:

- Headline unadjusted CPI rose at a steady pace of 0.7% on the month, as expected by the market and analysts in a MNI survey. On a seasonally adjusted basis, CPI was up 0.3% on the month, and 0.2% excluding food and energy.

- Increases were recorded in all major categories except for a 0.1% decline in household operations, furnishings and equipment. The largest upward contributor was gasoline, with a monthly gain of 11.6%, the largest since March 2007. CPI excluding gasoline was up 0.4%.

- On a 12-month basis, the headline CPI accelerated for the second consecutive month, rising 1.9% in March after 1.5% in February and 1.4% in January. The March readings were in line with market expectations, with mortgage interest cost being the largest upward contributor, although the 12-month growth pace stabilized at 8.1% after months of acceleration. A 4.4% drop in gasoline prices was the largest downward contributor. CPI excluding gasoline rose 2.2%.

- For the first quarter, year-over-year CPI averaged 1.6%, undershooting the Bank of Canada's 1.7% projection, and slowing down from 2.0% in the fourth quarter.

- The BOC's preferred measures of core inflation picked up to an average of 2.0% in March from 1.9% in February, providing a strong argument for the BOC to maintain its hiking bias, leaving a rate cut off the table. Two of the core measures increased by 0.1 percentage point: CPI-trim reached 2.1%, the highest since last October, and CPI-median reached 2.0%, the highest since August 2018.

--MNI Ottawa Bureau; email:


Please log in to read and leave comments