Statistics Canada

Canada's Consumer Price Index (CPI) for January marked the sixth consecutive month below the central bank's target. However, the Bank of Canada (BoC)'s core CPI rose to 2.1%, signaling underlying stickiness. The rebound in energy prices offset the historic decline in food prices driven by the sales tax holiday. Meanwhile, the slowdown in housing cost growth remained a key driver of inflation. This highlights the "mixed" nature of the economy, with market expectations suggesting that the Bank of Canada will hold interest rates steady in March, potentially initiating a gradual rate cut in the second quarter.

In December 2024, Canada's CPI reached its lowest level since 2020 and returned to the central bank's target range for the first time. Although it will take time to return to historically low inflation rates, this data indicates initial success in controlling inflation. However, potential trade risks remain a concern.

On October 15, data from Statistics Canada revealed that the Consumer Price Index (CPI) rose 1.6% on a year-over-year basis in September, down from a 2.0% gain in August. This was the smallest yearly increase since February 2021. This development increases the likelihood of a 50 basis point interest rate cut by the Bank of Canada at its meeting next week. 

On September 17, local time, Statistics Canada reported that Canada's CPI rose 2.0% year-over-year in August, down from a 2.5% gain in July and marking the lowest level since February 2021. The monthly CPI dropped 0.2%, in line with expectations.  

Employment was little changed in August (+22,000; +0.1%) while the employment rate decreased 0.1 percentage points to 60.8%. The unemployment rate rose 0.2 percentage points to 6.6%.

Real gross domestic product (GDP) increased 0.5% in the second quarter after rising 0.4% in the first quarter. 

Cost-related challenges remain among the top obstacles anticipated by businesses in the third quarter of 2024, though the proportion of businesses expecting cost-related obstacles has continued to ease since the second quarter of 2024. Meanwhile, the outlook of businesses has gradually improved since the fourth quarter of 2023.

Retail sales decreased 0.3% to $65.7 billion in June. Core retail sales were up 0.4% in June.

Prices of products manufactured in Canada, as measured by the Industrial Product Price Index (IPPI), were unchanged month over month in July and rose 2.9% on a yearly basis. Prices of raw materials purchased by manufacturers operating in Canada, as measured by the Raw Materials Price Index (RMPI), rose 0.7% month over month in July and increased 4.1% year over year.