Canada: Inflation picks up in April from March
Latest reading: Consumer prices were up 2.8% in annual terms in April, following a 2.4% increase in the prior month. April’s reading was the strongest since May 2024 but within the Central Bank’s 1.0–3.0% inflation target range.
Relative to the prior month’s figures, there were higher price pressures for housing (+1.8% on a year-on-year basis vs +1.7% in March), transportation (+6.8% vs +3.2% in March) and clothing and footwear (+1.5% vs -0.1% in March). In contrast, there were milder price pressures for food (+3.5% vs +4.0% in March) and recreation and culture (+1.0% vs +2.6% in March).
Meanwhile, core consumer prices were up 2.1% in annual terms in April, following a 2.5% rise in the previous month.
Finally, consumer prices were up 0.36% in April on a month-on-month basis, following a 0.90% increase in the previous month.
Panelist insight: On the latest data, Nomura analysts said:
“The April CPI report supports our view that inflation pressures remain broadly contained. Although firms are reporting some pickup in cost pressures, weak labor demand and elevated consumer price sensitivity should limit the pass-through to consumer prices. Anchored inflation expectations should also give the BoC room to look through near-term energy-driven price increases.”