- Jack Spitz, managing director of foreign exchange at National Bank of Canada
Canada's industrial product prices climbed amid recovering energy and petroleum products in June, while the raw materials index remained flat. The monthly decline in the Canadian Dollar against its US counterpart bolstered the results. Canada's industrial product price index rose 0.5% in the measured month, Statistics Canada reported. The data beat market expectations of a 0.4% increase. The main contributor to higher IPPI appeared to be higher prices for energy and petroleum products, which rose 2.0% and were led by motor gasoline. Excluding energy, the index ticked up by 0.4%. Higher auto prices were largely due to the depreciation of the Canadian Dollar versus the Greenback, as some items are always reported in US dollars. From May to June the Loonie dropped 1.5% against the US peer. If the exchange rate effect was taken out of the calculations, the IPPI would have advanced only 0.2%.
The Raw Materials Price Index (RMPI) remained unchanged in June, falling short of economists consensus of a 1% rise. Meanwhile, Canada's inflation was in line with forecasts in June, accelerating to 1% over the past year, led by rising food and shelter costs. At the same time, the Bank of Canada's annual core CPI, which excludes volatile categories, remained above the central bank's goal for the eleventh month in a row, rising to 2.3%.
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