Economists expect little movement in Canada inflation The figures, if applicable, when the data in January will be published this week, although the underlying variation in prices is darkened by a full month of the Government TPS break.
The consumer price index of Statistics Canada for the first month of 2025 is expected to be published on Tuesday.
Canada’s annual inflation rate fell to 1.8% in December, largely due to the federal government break on the sales tax for a range of goods before the Christmas holidays. Catering and alcohol purchases purchased in stores have contributed the most to deceleration – both were suspended from the GST when it started on December 14.
Without tax relief, however, statistics Canada estimated that inflation would rather have reached 2.2% compared to 1.9%.
“The broader story is that inflation is – even when you remove this special factor (tax relief) – is close to two percent. Perhaps a little above, “said the chief economist of the BMO, Doug Porter, who expects the inflation rate stable.
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“We are in a much better place than a year ago, and even less two or three years ago, when inflation was hot.”
The deputy chief economist of the RBC, Nathan Janzen, expects inflation again to 1.7%, also due to temporary tax relief.
“The tax days will continue to reach muddy inflation readings until March, when we can obtain a cleaner reading of the consumer price index that appears distortions,” wrote Janzen in a note to customers.
“However, the Bank of Canada will focus on their” noyal “measures (consumer price index), which exclude the impact of indirect taxes, for clues to the way in which the underlying inflation trends ‘Announce. “
The prices growth of the grocery store in December deceived a month earlier, falling to 1.9% in annual sliding, while gas prices increased to 3.5%.
The inflation of shelter costs remains high, although it has slowed slightly in December to 4.5%, while rent prices increased by 7.1% compared to the same month a year earlier.
In its deliberations before the reduction of its interest rate for three percent on January 29, members of the Banque Director of Canada’s Council indicated that they were encouraged by recent indicators who showed that the economy took steam, and the holding inflation of its two percent targets.
Porter said that the heaviest measure by which the central bank will weigh against another rate drop is the way in which the potential trade war with the United States takes place. The next rate decision is scheduled for March 12.
“The generalized hypothesis is that the bank will continue to shave the rates a little further, which would place them roughly in the middle of what I would consider that the bank would be neutral,” said wearing.
“I see 2.5% as being close enough to the neutral for the Bank of Canada, and I would tell you that we are not yet entirely three percent.”
& Copy 2025 the Canadian press