Canada September 2018 consumer price index data
Prior was +2.8% y/y
- Prices -0.4% m/m vs +0.0% expected (some forecasts had +0.1% as the consensus)
- Prior m/m was +0.1%
Core numbers y/y:
- Core common +1.9% vs 2.0% prior
- Core median +2.0% vs +2.1% prior
- Core trim +2.1% vs +2.2% prior
Big miss here and USD/CAD quickly to 1.3117, up 80 pips from before the data and a six-week high. StatsCan said transitory pressures from the gasoline, air transportation and travel tours indexes, which boosted the all-items CPI in July and August, eased.
It looks like vehicles were a big drag. "The purchase of passenger vehicles index (+0.6%) rose less on a year-over-year basis in September than in the previous month (+2.3%), which was largely attributable to the lower availability of new model-year vehicles compared with the same month last year."
Services inflation was at +2.5% y/y compared with +3.1% prior but if you strip out a lot of the quirks (like air transportation -16.6%) then it's mitigated.
The core numbers are a pretty good reflection of inflation and they're a tad softer but still right on the BOC's target, with the trio averaging 2.0%.
