BCREA ECONOMICS NOW
Canadian Consumer Price Inflation -
Canadian consumer price inflation picked up marginally in February,
registering 1.2 per cent year-over following a 0.5 per cent increase in
January. The Bank of Canada's core inflation index, which excludes the eight
most volatile components of the CPI like energy and food, rose 1.4 per cent
year-over-year in February, a moderate acceleration from January's 1 per cent
increase. Inflation in BC registered
only 0.9 per cent year-over-year in February.
Subdued by sluggish growth in the Canadian economy over the past six
months, inflation continues to trend well under the Bank of Canada's two per
cent target. As economic growth improves
in the latter half of 2013 and into 2014, inflation should gradually move back
toward 2 per cent. Until then, we expect that the Bank of Canada will remain on
hold and that longer term interest rates that impact mortgage pricing will hold
near historic lows.
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