Canadian inflation slowed significantly last month as temporary factors that lifted the cost of gas and air travel dissipated.
Canada’s CPI climbed +2.2% y/y, following a +2.8% increase in August and a +3% climb in July.
The market was looking for a solid +2.7% gain in September.
On a month-over-month basis, CPI declined -0.4%.
Digging deeper, the Bank of Canada (BoC) three preferred measures supporting inflation also weakened – core-inflation prices rose in a range from +1.9% to +2.1% for an average of +2.0%, down from the previous month’s +2.1% average.
Despite this morning miss, the headline annual inflation rate in Canada has come in +2%+ for eight consecutive month.
Canada retail sales miss
Canadian retail sales fell unexpectedly in August, led mostly by gas stations receipts declines.
Canada retail sales fell -0.1% in August, m/m, to a seasonally adjusted +C$50.76B. The market was looking for a +0.3% rise.
In volume terms, retail sales declined by a steeper -0.3% in August.
The previous month’s data were revised downward, and indicated receipts rose +0.2% vs. +0.3% estimate.
On a 12-month basis, retail sales rose +3.6% on a nominal basis and +0.7% in volume terms.
On the release, the CAD came under immense, trading at C$1.3030 before the headlines to C$1.3116.
Next up, the BoC monetary policy announcement is next Wednesday (Oct 24). Despite a weaker retail sales and inflation, the market is currently pricing in another +25 bps hike by Governor Poloz. The OIS mkt still at +97% that they hike.
Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.
Dean Popplewell
He has a deep understanding of market fundamentals and the impact of global events on capital markets.
He is respected among professional traders for his skilled analysis and career history as global head
of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean
has played an instrumental role in driving awareness of the forex market as an emerging asset class
for retail investors, as well as providing expert counsel to a number of internal teams on how to best
serve clients and industry stakeholders.
Latest posts by Dean Popplewell (see all)
- Euro zone bond yields sink as German manufacturing slows - 24 July 2019
- How Boris Johnson Plans to Deliver Brexit in 100 Days - 24 July 2019
- Weak PMI’s Sink EUR - 24 July 2019