Canada February CPI +2.6% y/y vs +2.2% expected

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Canada February CPI +2.6% y/y vs +2.2% expected

• Prior month 1.9%
• CPI m/m +1.1% versus +0.6% expected. Prior month +0.1%
• Core CPI m/m +0.7% versus +0.4% last month
• CPI y/y +2.6% versus 2.2% estimate
• Core CPI y/y 2.7% versus 2.1% last month
• CPI Median y/y 2.9% versus 2.9% estimate. Last month 2.6% revised from 2.4%
• CPI Trim 2.9% versus 2.6% expected Last month 2.9%
• CPI Common 2.5% versus 2.5% last month

This report is a mess of special factors over the next few months. On Feb 15, the HST (Canada's sales tax) went back into effect on some items after a two month holiday. Now, starting in April, the carbon tax will be removed.

One of the items that was removed was restaurant food prices and Statistics Canada said that category "contributed the most to the acceleration in the all-items CPI in February."

There was some downward pressure on the main index from gasoline as y/y prices decelerated, with a 5.1% increase in February following an 8.6% gain in January.

Here were 3 categories of items that had the sales tax break; it covered about 10% of the all-items CPI basket.

                            This article was written by Adam Button at www.forexlive.com.

Source: Canada February CPI +2.6% y/y vs +2.2% expected

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