Canada April CPI +1.7% y/y vs +1.6% expected ...Middle East

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Canada April CPI +1.7% y/y vs +1.6% expected
Prior month 2.3%CPI m/m -0.1% versus -0.2% expected. Prior month +0.3%Core CPI m/m +0.5% versus +0.1% last monthCore CPI y/y +2.5% versus 2.2% last monthCPI Median y/y 3.2% versus 2.9% estimate. Last month 2.9%CPI Trim 3.1% versus 2.9% expected Last month 2.8%CPI Common 2.5% versus 2.3% last month

The quirk in Canadian CPI data is that there was a GST (Canada's VAT) holiday that ended on Feb 15 and that has been reverberating, followed by the removal of the carbon tax on April 1, lowering gasoline prices.

The market was pricing in a 65% chance of a BOC rate cut in early June ahead of this data but that's quickly back to 51%. These core numbers are uncomfortably hot and may represent some trade war pass-thru.

    This article was written by Adam Button at www.forexlive.com.

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