TD Securities analysts suggest that Canada’s headline CPI is forecasted to recover to 2.0% YoY in October, with prices 0.4% higher on the month.
Key Quotes
“Gasoline prices were little changed on the month despite seasonal headwinds, which should see the year-ago drag from energy diminish by ~0.1pp. Outside of gasoline, we expect natural gas and heating oil to drive a modest increase in energy prices, reflecting unseasonably cold weather across Western Canada during the month. However, this will be more than offset by softer food prices following a pullback in producer-level food prices along with agriculture products.”
“Stripping out both leaves the ex. food & energy index up 0.6% m/m, with much of this driven by seasonal effects in apparel and telecoms. Looking to the Bank’s preferred core measures, we see downside risks, owing to sizeable base-effects.”
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