Canada’s Annual Inflation Moderates in September

         

Summary: Canada’s annual inflation rate in September showed a decline to 3.8%, beating analysts’ expectations. The decrease was driven by price reductions in travel-related services, durable goods, and groceries. Economists predict that inflation will remain in the 3% range in the coming months.

Canada’s annual inflation rate in September dropped to 3.8%, according to Statistics Canada. This figure surpassed economists’ predictions of the rate remaining at 4.0%. The decline in inflation can be attributed to price reductions in various sectors. Travel-related services, durable goods, and groceries all experienced broad-based decreases in prices. This data suggests that the previous month’s high inflation rate in August was an outlier, indicating that inflation will likely hover around 3% in the coming months rather than the 4-4.5% range. As a result, it is unlikely that the central bank will raise interest rates in October. Additionally, the Bank of Canada is facing pressure to address inflation expectations that are well above their 2% target. However, some economists argue that on a trend basis, the central bank should continue to raise rates due to factors such as strong immigration, housing inventory, commodity drivers, and increased wage demands.

Tags: Canada, inflation rate, price reductions, economy

Share: