Canada: Headline inflation to decelerate to 2.1% y/y in June - TDS
|Analysts at TD Securities are looking for China’s headline inflation to decelerate to 2.1% y/y in June, with prices down 0.2% from May.
Key Quotes
“Lower gasoline prices will provide the main driver for the monthly print; gasoline prices fell by 8% for the month as a whole, which should shave 0.3pp off the headline print in June. Elsewhere, food prices should see modest gains following the recent strength in producer prices, however, 3.5% is likely to mark the peak for food price inflation since FX passthrough from a stronger Canadian dollar should start to provide some relief in the coming months.”
“We also see scope for a pullback in telecom prices after new "unlimited" data plans were introduced by major service providers in early June. Looking past the headline, exclusion based core measures (ie. ex food and energy) should hold stable given the large drag from energy prices while the Bank of Canada's preferred core measures are likely to edge lower to 2.0% y/y on average.”
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