Analysts at TD Securities expect Canadian CPI to slip to 2.7% in September as prices continue to unwind from the previous pickup.
Key Quotes
“Energy prices remain a lift to inflation but should decelerate on a y/y basis, whereas food prices should pick up marginally. Outside of food and energy, we expect a mixed bag and therefore a lot hinges on the oneoff categories, particularly airfares.”
“But if anything we view risks skewed to the downside. More attention will also be on the core measures this month, which averaged an above-target rate of 2.1% in August. That’s not significant enough to impact BoC’s policy bias, and a further move higher is unlikely.”
“We expect a stable reading and will be mindful of any downward revisions as well. Going forward, we expect headline inflation to continue to slide lower through yearend, averaging 2.5% in Q4, in line with the BoC’s forecast.”
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