FXStreet (Delhi) – Ned Rumpeltin, European Head of Currency Strategy at TD Securities, notes that the August CPI is the lone data release for Canada and we are in line with consensus looking for a flat month-over-month print on the headline measure, as falling gasoline prices will offset increasing price pressure elsewhere in the economy.
Key Quotes
“We look for core CPI to increase by +0.3% m/m (mkt +0.2%) on higher clothing, telecommunications, and auto prices. On a year-ago basis, inflate on in the all-items measure is expected to remain unchanged at +1.3% y/y (in line with consensus), while we forecast a deceleration in core inflation from +2.4% to +2.2% y/y (consensus: +2.1% y/y).”
“We do not expect this report to have a material impact on monetary policy, as the Bank of Canada has repeatedly argued that they do not view core CPI as an accurate proxy for underlying inflation.”
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