Canada: June CPI Inflation Was a Scorcher but Relief May Be Ahead

Summary of the publication

• Consumer prices rose 0.7% m/m in June, pushing the annual rate of inflation up to 8.1% y/y from 7.7% in May. However, this was below the consensus call of 8.4%.
• On a monthly basis, energy prices advanced by 3.9% in June, well below May’s 8.5% pace, although it still clocked in at 38.8% above the level a year ago. The monthly gain in food prices also slowed, rising by 0.1% June for the smallest monthly print since April 2021.
• Excluding food and energy, prices were 5.3% higher in June than they were a year earlier, accelerating just a tick above the May pace. On the monthly basis, this frequently-used measure of inflation was up 0.4% in June, the smallest monthly print since December 2021.
• Notably, the Bank of Canada’s three core measures of inflation averaged 5.0% over last year, edging up slightly from 4.9% in May.