Canada Annual Inflation Rate at 10-Month Low in November

The annual inflation rate in Canada fell to 1.7 percent in November 2018 from 2.4 percent in the previous month and below market expectations of 1.8 percent. It was the lowest inflation rate since January, mainly due to a slowdown in cost of transportation as gasoline prices declined.

Year-on-year, prices of transportation slowed (1.0 percent compared to 4.3 percent in October), mostly due to cost of gasoline (-5.4 percent) as falling global crude oil prices dragged down prices at the pump. It was the first decline in gasoline since June last year. Shelter costs advanced 2.4 percent, easing from a 2.5 percent gain in October. Additionally, prices advanced at a softer pace for household operations, furnishings and equipment (0.9 percent compared to 1.4 percent); recreation, education and reading (1.2 percent compared to 1.8 percent); clothing and footwear (0.6 percent compared to 1.3 percent) and health and personal care (0.7 percent compared to 0.8 percent). On the other hand, prices went up further for both food (2.2 percent compared to 2.0 percent) and alcoholic beverages and tobacco products (4.6 percent compared to 4.5 percent). 

Regarding special aggregates of the CPI, prices for durable goods dropped 0.1 percent, after a 0.9 percent gain in October. The purchase of passenger vehicles rose 0.8 percent, compared to a 1.7 percent increase in the previous month. Meantime, cost of services advanced 2.7 percent, the same as in October.

On a seasonally adjusted monthly basis, consumer prices fell 0.4 percent, after rising 0.3 percent in the prior month and in line with market consensus. Prices of transportation and health and personal care dropped the most.

The BoC's annual core inflation, which excludes volatile items, went down to 1.5 percent from 1.6 percent in October.

Canada Annual Inflation Rate at 10-Month Low in November

Statistics Canada | Stefanie Moya |
12/19/2018 1:56:10 PM