Canada: Lower oil and broader energy prices, likely to weigh on CPI in July – Wells Fargo
|On Wednesday, CPI data from Canada is due. Analysts at Wells Fargo, expect the annual rate to drop from 2.0% to 1.6%.
Key Quotes:
“Canadian consumer inflation matched expectations in June with a slowdown to 2.0% year-over-year, down from 2.4% in May. Core inflation held steady in line with the Bank of Canada’s target, as well as consensus estimates. Lower oil and broader energy prices are likely to weigh on CPI in July, and we forecast headline CPI inflation to slow to 1.8% in 2019 and pick up slightly in 2020.”
“As for upside inflation risks, core inflation may show resilience in July after the latest average hourly earnings figure quickened and Canada’s economy grew for the third consecutive month in May, providing further evidence of a stronger Canadian economy. Even though Canadian job creation slowed in July, the labor market remains strong and provides an additional upside risk for inflation.”
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