Canadian CPI Preview: Forecasts from six major banks, inflation continued to heat up in June


Share:

Statistics Canada will release June Consumer Price Index (CPI) data on Wednesday, July 20 at 12:30 and as we get closer to the release time, here are the forecasts by the economists and researchers of six major banks regarding the upcoming Canadian inflation data. 

The June Canada inflation rate is expected to rise by +0.9% MoM from +1.4% MoM, clocking in at +8.3% YoY from +7.7% YoY. The Bank of Canada's Core CPI, which excludes volatile food and energy prices, is estimated to rise 0.5% MoM, surging to 6.7% on yearly basis from the 6.1% previous.

TDS

“We look for CPI to firm to a new high of 8.3% in June with prices up 0.8% MoM. Food and energy will provide the main drivers, led by gasoline (+6.8%). Shelter will provide another source of strength as higher rates feed through to mortgage payments, while seasonal headwinds to clothing will provide a slight drag. Core inflation should firm by 0.2pp to 4.9% on average.”

RBC Economics

“We anticipate Canada’s inflation rate will edge up to 8.0% from a year ago. That would be the highest since 1982. This continued acceleration was likely largely driven by higher food and energy prices – both of which have been boosted by global pressures. Oil prices rose another 4.8% from May and consumer food prices have been surging in part due to higher commodity prices and acute supply chain disruptions. Roughly half of inflation recently has been driven by forces beyond our borders by our count. Inflation pressures are unlikely to ease sustainably to the BoC’s 1% to 3% target range until the economy, and labour markets, have cooled substantially.”

NBF

“The food component likely remained very strong given severe supply constraints globally and the increase in this segment may have been compounded by higher gasoline prices. As a result, headline prices could have increased 0.6% MoM before adjustments for seasonality, allowing the year-on-year rate to rise three ticks to 8.0%. The annual rate of common CPI, meanwhile, could move up from 3.9% to 4.2%.”

CIBC

“CPI inflation should have peaked in June at 8.5% year-over-year. While recent pullbacks in the prices of oil and some agricultural commodities should provide relief in the future, it will not be apparent in the June CPI data. There was a further increase in gasoline prices in the month relative to May, and with the long lag between changes in agricultural prices and food prices in stores, we are still living through the impact of past increases. But recent developments mean that we should start to see some relief in the months ahead. Outside of food and energy, we expect CPI inflation to have grown slower on the month and to be roughly stable at an annual rate. Prices linked to the housing market, though still increasing, are not exerting as much upward pressure on CPI as they were just a few months ago. Overall, while we see June as the peak, inflation should stay close to 8% through the summer months.”

Wells Fargo

“We expect Canada's CPI release to show persistently high inflation yet again. We expect Canada's headline CPI to quicken to 7.9% year-over-year and forecast inflation to average 6.6% in 2022.”

Citibank

“Canada June CPI NSA MoM (Jun) – Citi: 0.7%, prior: 1.4%, CPI YoY – Citi: 8.2%, prior: 7.7%. As in May data, inflationary pressures should be broad-based. The three core inflation measures averaged a very strong 4.7% in May and should also remain high and likely even climb higher in June.”

 

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content


Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content

Editors’ Picks

EUR/USD consolidates gains above 1.0800, awaits Fed Minutes

EUR/USD consolidates gains above 1.0800, awaits Fed Minutes

EUR/USD is holding gains above 1.0800 early Wednesday, having hit two-week highs on Tuesday. The US Dollar remains broadly weak, despite a mixed market mood, as investors weigh Fed rate cut bets and US government shutdown risks ahead of the Fed Minutes. 

EUR/USD News

GBP/USD clings to gains above 1.2600, all eyes on FOMC Minutes

GBP/USD clings to gains above 1.2600, all eyes on FOMC Minutes

GBP/USD is holding the renewed upside above 1.2600 in early Europe on Wednesday. The pair continues to draw support from hawkish comments from BoE Governor Bailey and an extended US Dollar weakness. The focus now shifts to the Fed Minutes, BoE- and Fed-speak.

GBP/USD News

Gold price bulls turn cautious near 50-day SMA, one-week top ahead of FOMC minutes

Gold price bulls turn cautious near 50-day SMA, one-week top ahead of FOMC minutes

Gold price (XAU/USD) touches over a one-week high on Wednesday, albeit struggles to build on the momentum and remains capped near the 50-day Simple Moving Average (SMA) through the early European session.

Gold News

Bitcoin is 23% away from ATHs, but retail is still not here, why?

Bitcoin is 23% away from ATHs, but retail is still not here, why?

Bitcoin’s journey so far has been nothing short of shocking. From ETF approval to countries warming up to crypto regulation, the crypto landscape seems to have changed quite a bit.

Read more

Will the FOMC Minutes give clues on the timing of rate cuts?

Will the FOMC Minutes give clues on the timing of rate cuts?

Tonight, Minutes from the FOMC's January meeting will be released. Markets will keep a close eye on any clues regarding the timing of the first rate cut, which we now expect to come in May.

Read more

Forex MAJORS

Cryptocurrencies

Signatures