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1.6 Per cent inflation rate provides `nasty` surprise for bank of Canada
OTTAWA — Inflation data for February came in much stronger than expected, Statistics Canada reported Friday, with the key core rate — watched closely by the Bank of Canada — posting a surge beyond the key two per cent threshold in what analysts describe as a "nasty" surprise.
Statistics Canada said consumer prices rose 1.6 per cent year-over-year in February, following a 1.9 per cent increase in January. For the month, prices rose 0.4 per cent. Market expectations were for a year-over-year rise of 1.4 per cent.
Meanwhile, the core rate, which strips out volatile-priced items such as food and energy, advanced 2.1 per cent year-over-year in February. It had risen two per cent in January. Market expectations were for core inflation to decline, to 1.7 per cent year-over-year.
The consumer price data, combined with robust retail sales figures for January, has likely set off alarm bells at the Bank of Canada, economists say, as to whether the central bank can keep its conditional pledge to maintain its target rate at 0.25 per cent until July.
However, analysts note the inflation data come with a caveat, as the Winter Olympics in Vancouver drove up prices in some key categories.
Read the full article here.
OTTAWA — Inflation data for February came in much stronger than expected, Statistics Canada reported Friday, with the key core rate — watched closely by the Bank of Canada — posting a surge beyond the key two per cent threshold in what analysts describe as a "nasty" surprise.
Statistics Canada said consumer prices rose 1.6 per cent year-over-year in February, following a 1.9 per cent increase in January. For the month, prices rose 0.4 per cent. Market expectations were for a year-over-year rise of 1.4 per cent.
Meanwhile, the core rate, which strips out volatile-priced items such as food and energy, advanced 2.1 per cent year-over-year in February. It had risen two per cent in January. Market expectations were for core inflation to decline, to 1.7 per cent year-over-year.
The consumer price data, combined with robust retail sales figures for January, has likely set off alarm bells at the Bank of Canada, economists say, as to whether the central bank can keep its conditional pledge to maintain its target rate at 0.25 per cent until July.
However, analysts note the inflation data come with a caveat, as the Winter Olympics in Vancouver drove up prices in some key categories.
Read the full article here.