DATA SNAP: Canada Annual CPI Advances 1.3% in July

Both stories noted that index rose for the sixth straight month in July, inching up by 0.1 percent and 0.2 percent from the previous month and year respectively according to the Labor Department on Wednesday.

Food prices were up 3.2 per cent compared with a year ago, led by meat prices which rose 6.1 per cent. Prices for food bought from stores was up 3.5 per cent, while food bought in restaurants was up 2.7 per cent.

Canada’s all-items consumer-price index rose 1.3% in July from a year earlier, Statistics Canada said Friday, matching market expectations as provided by economists at Royal Bank of Canada.

Once again, lower energy prices kept overall inflation down. But that was all a price effect as volumes were flat on the month, although real sales recovered 0.4% in 2Q after a 0.4% decrease in 1Q.

Statistics Canada said the transportation index, which includes gasoline, was the only one of eight components to show a decline – its ninth month in a row.

Excluding energy, inflation was up 2.2% nationwide.

The CPI for other bakery products in July was 269.7, up 1.1% from June and up 1.2% from July 2014. Prince Edward Island noticed costs drop to submit its eighth consecutive year-over-year lower.

Indeed, the Bank of Canada has shifted its focus to what it calls “underlying inflation” – an effectively unobservable series which removes special factors, such as exchange rate effects, from core inflation.

“Exports are anticipated to regain momentum in the second half of the year as U.S. private domestic demand regains strength, energy production capacity comes back online and additional capacity is added, and global demand growth picks up”, the BOC expected in its July Monetary Policy report.