Inflation numbers for February were below expectations. The CPI rose 0.5% per month (consensus: 0.7%) and the annual rate was 1.1%, the highest value in a year. According to Canadian National Bank analyst Kyle Dhams, inflation should accelerate due to the positive core effect.
Important quotes:
“The CPI report for February was weaker than expected. Although the annual headline inflation was tepid, it reached its highest level in a year thanks to the sharp rise in gasoline prices in recent months.”
“Core inflation metrics remained on track during the month. The average of the three core inflation metrics favored by the Bank of Canada remained at 1.7%.”
“We believe that inflation should accelerate early next month due to the positive underlying effect. That’s not all: Generous government aid programs, which should remain in place until normal conditions return, will continue to create an artificial shortage of labor.” Commodity prices, including In it, grocery stores (a heavyweight cart) rose sharply, which could also hurt the purchasing power of Canadian consumers in the coming months.
“The supply chain disruptions that are currently driving inflation up for some time could continue to offset other downward forces. In this context, we see headline inflation in the fourth quarter of 2021 at around 2.6%.”
“Communicator. Entrepreneur. Introvert. Passionate problem solver. Organizer. Social media ninja.”
More Stories
Great Britain wants to increase defense spending to 2.5 percent of GDP
SWR and School of the Future / Journalist Frank Seibert looks for new school models in Dresden, Winnipeg (Canada) and Essen
New Law in Britain: Sunak's Rwanda Life Belt