Canada Inflation Rate Moderates to 1.9% in December

The consumer price index in Canada rose 1.9 percent year-on-year in December of 2017, easing from a 2.1 percent gain in the previous month and matching market consensus. Prices of transport contributed the most to the slowdown in inflation. Meanwhile, cost of shelter and food continued to grow. Also, the BoC's annual core inflation, which excludes volatile items, went down to 1.2 percent compared to 1.3 percent in November.
Statistics Canada | Luisa Carvalho | 1/26/2018 1:58:11 PM
Consumer prices for transportation rose 4.9 percent on a year-over-year basis in December, following a 5.9 percent increase in November. The movement in transportation prices was led by gasoline, which rose 12.2 percent, after increasing 19.6% the previous month. The purchase of passenger vehicles index increased 3.7 percent, following a 3.6 percent gain in the prior month.

The shelter index grew 1.4 percent, after increasing 1.2 percent in November. The natural gas index contributed to the gain in this major component, up 6.2 percent in December following a 3.1 percent increase in November.

Prices of food advanced 2 percent, after rising 1.6 percent in the prior month. Food purchased from stores was up 1.5 percent in the 12 months to December. Higher prices for fresh vegetables (+6.9 percent) contributed the most to the increase. Prices for food purchased from restaurants rose 2.9 percent.

Household operations, furnishings and equipment costs fell 0.3 percent, after increasing 0.9 percent in November. This decline was largely due to price decreases in telephone services, down 5.0 percent in December.

On a monthly basis, consumer prices inched down 0.4 percent, following a 0.3 percent rise in the prior month and compared with market expectations of a 0.3 percent fall.

Canada Inflation Rate Moderates to 1.9% in December