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CANADA-INFLATION-INDICATOR
Higher transportation, mortage costs push up Canada inflation
OTTAWA, Nov 24, 2018 (BSS/AFP) – Canadians paid 2.4 percent more for goods
and services in October than a year earlier, with higher expenditures led by
rising transportation and mortgage costs, government data showed Friday.
Gasoline prices jumped 12 percent while air travel and the purchase of
passenger vehicles rose 9.4 and 1.7 percent, respectively, said Statistics
Canada.
The latter rose as auto makers made more new model-year vehicles
available, but offered lower rebates.
Mortgage interest costs, meanwhile, increased 7.0 percent in the 12 months
to October, reflecting several interest rate increases in the past year from
near-historical lows.
The Bank of Canada’s key lending rate is now 1.75 percent.
It said last month it would “take into account how the economy is
adjusting to higher interest rates, given the elevated level of household
debt” in deciding future rate increases.
Its next interest rate announcement is scheduled for December 5.
Economists had expected October inflation to come in at 2.2 percent.
CIBC analyst Andrew Grantham suggested in a research note that the spike
was a blip.
“Given the recent dive in oil prices that acceleration will prove
temporary,” he predicted, anticipating that inflation will cool noticeably
next month to about 2.0 percent.
BSS/AFP/HR/0950