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Canadian Econ Weekly Wrap: Hotter than expected CPI; Retail Sales; Housing Data

Published 2022-04-23, 03:58 p/m
© Reuters.

By Ketki Saxena

Investing.com -- The biggest story in Canadian economics last week was the inflation data for March. Statistics Canada reported that the CPI (Consumer Price Index) rose 6.7% on a year-over-year basis in March, with inflation broad based across categories, including essentials such as energy, groceries, and shelter.

Other major data in Canadian econ last week included Canadian international securities transactions, retail sales, and raw materials price index.

The week also included several reports on Canadian housing, including housing starts, existing home sales, current supply, and two indexes of home price: from the Canadian Real Estate Association, and from Teranet/National Bank.

Due to the high volume of housing data this week, this week’s piece includes a special edition of the Canadian Econ Weekly Wrap: Canadian Housing Week’s Recap

The Week’s Recap:

  • Canadian international securities transactions, February: International transactions generated a net inflow of funds into the Canadian economy of roughly C$17.12 billion, indicating slowing foriegn investment for the second consecutive month. Nonresident investors purchased a net 7.44 billion worth of Canadian securities, compared to C$13.54 billion in the previous month. Canadian investors sold a net C$9.68 billion in foreign securities, compared with net selloff of C$11.44 billion in the previous month.

  • Canadian CPI, March: Canadian CPI rose 6.7% on a year-over-year basis in March, higher than the 6.1% reading expected by economists, and 5.7% in February. Inflationary pressures were broad based, including in consumer necessities such as housing, food and energy. Gasoline prices were up 11.8% on the month, and 39.8% from a year earlier Month over month, prices for fuel oil and other fuels rose 19.9%. On a year-over-year basis, prices for fuel oil and other fuels rose 61.0% in March. Canadians paid 8.7% more YoY for groceries. Goods inflation was at 9.2%, while services inflation rose to 4.3%.

  • Retail sales, February: Canadian retail sales rose month on month in February on higher sales of clothing and gasoline, increasing 0.1% in February to a seasonally adjusted C$59.90 billion, beating market expectations for a 0.4% decline in the month. In volume--or price-adjusted--terms, February retail sales decreased by 0.4%

  • Industrial Product Price Index, March: The Industrial Product Price Index rose 4.0% month over month in March 2022, the largest monthly change on record since the series began in 1956. Year over year, the index increased 18.5%, its biggest gain since December 1974.

  • Raw materials price index, March: The Index, which measures the prices of raw materials purchased by manufacturers operating in Canada, was up 11.8% on a monthly basis in March 2022 and up 42.7% year over year. The increase was mainly driven by higher prices for refined petroleum products (including liquid biofuels), which rose 18.8%. Year over year, prices were up 65.7%.

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