Canada June CPI data due on Wednesday - preview

Author: Eamonn Sheridan | Category: News

Coming up at 1230GMT, June month inflation data from Canada:

  • expected -0.3%, prior 0.4%
  • expected 2.0%, prior 2.4%
Some brief comments via bank previews.

TD:
Forecast:
  • -0.2% m/m
  • 2.1% y/y 
Citing:
  • Lower gasoline prices will provide the main driver for the monthly print
  • food prices should see modest gains
  • see scope for a pullback in telecom prices
On core inflation:
  • exclusion based core measures (ie. ex food and energy) should hold stable given the large drag from energy prices while the Bank of Canada's preferred core measures are likely to edge lower to 2.0% y/y on average
Scotia:
  • expect 1.9% y/y
  • shift in base effects alone would lower inflation
  • soft seasonal effects
  • June gasoline prices fell by 9-10%
  • The C$ depreciated by about 5% y/y in May of this year over May of the prior year. Usually this is a transitory effect upon inflation and we expect recent C$ strength to persist over our forecast horizon. 

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