- Ian Pollick, a fixed-income strategist at Royal Bank of Canada's RBC Capital Markets
Canada price pressure eased last month, due to a drop in gasoline prices, further underlining how little pressure there is on the Bank of Canada to raise rates any time soon. According to the Statistics Canada, consumer prices grew 1% from a year ago, after a 1.2% growth in the preceding month, while on a monthly basis, the inflation rate rose only 0.2%. The core inflation, which excludes eight volatile products, remained unchanged in March at 1.4%. In the meantime, gasoline prices dropped 0.3% from a year earlier in March, after gaining 3.9% in February. During the last policy meeting, the Bank of Canada said that inflation is expected to remain below policy makers' 2% target until the second quarter of 2015, as weak growth of the world's 11th largest economy weighs on consumers' willingness to increase spending.
"It has to do with how far away Canada is from its productive capacity," said Ian Pollick, a fixed-income strategist at Royal Bank of Canada's RBC Capital Markets unit in Toronto.
"After quite a bit of volatility in the prior few months, Canadian inflation has shown its true colors a little more clearly this month - and those colors are pretty bland," said Doug Porter, chief economist at BMO Capital Markets.
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