Lower Gasoline Prices Continue to Weigh on Inflation

Sep 18 15:09 2019 Print This Article

Ottawa, September 18, 2019—The Conference Board of Canada’s Principal Economist Alicia Macdonald offers the following insights on today's Consumer Price Index data:

“The Consumer Price Index was up 1.9 per cent on a year-over-year basis in August, down slightly from 2.0 per cent in July. The average of the Bank of Canada’s three measures of inflation held steady at 2.0 per cent. With inflation anchored at the Bank’s target, we will not see the Bank of Canada cut interest rates this year.”

Insights:

Inflation increased at a 1.9 per cent pace in August, a tad softer than the 2.0 per cent gain observed in the previous month.

Excluding the impact of gasoline, which was down 10.2 per cent over last August, inflation held steady at 2.4 per cent.

Mortgage interest costs continue to put upward pressure on inflation, although the pace of increase has slowed in recent months alongside lower mortgage rates. After peaking at an 8.2 per cent increase in May, mortgage interest costs were up 7.8 per cent in April.

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Conference Board of Canada

The Conference Board builds leadership capacity for a better Canada by creating and sharing insights on economic trends, public policy and organizational performance. The foremost independent, evidence-based, not-for-profit applied research organization in Canada.The Conference Board is funded exclusively through the fees we charge for services to the private and public sectors. They are leading experts in: conducting, publishing, and disseminating research and forecasting, economic analysis and specialists in economic trends, as well as organizational performance and public policy issues. Conference Board is not a government department or agency, although are frequently hired by government services.

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