RE:RE:Cpi prediction for todayThe consumer is heavily indebted because rates were too low for too long. And yet current rates are still below historical averages. Retires have been getting screwed for almost 15 years now and forced to take on more risk in the market, and time is not on their side if a mistake is made. Food inflation is still out of control. Housing is back to record highs. I would be in favour of another 1/4 pt hike in July and then let the next meeting pass before making another move. Unfortunately, there needs to be some pain to right this ship.
Torontojay wrote: Here is an update:
- Lowest reading since June 2021
- Prior was 4.4%
- CPI m/m +0.4% vs +0.5% expected
- Prior m/m reading was 0.7%
- Gasoline prices -18.3% vs -7.7% y/y in prior month
- Gasoline prices -0.8% m/m vs +6.3% prior month
- Ex gasoline +4.4% vs +4.9% prior
- Food +8.3% vs +9.1% y/y prior
- Mortgage interest costs 4.9% y/y vs 4.9% increase in April
- Goods inflation +2.1% y/y
- Services inflation +4.9%
Core measures:
- BOC core y/y 3.7% vs 3.9% expected (prior 4.1%)
- BOC core m/m +0.4% vs +0.5% prior
- Median 3.9% vs 4.2% prior
- Trim 3.8% vs 4.2% prior
- Common 5.2% vs 5.7% prior
This is the final CPI print ahead of the July 12 Bank of Canada rate decision. Ahead of the release, the market was placing a 65% probabilty on a 25 bps rate hike and that ticked to 62% afterwards. I maintain that the BOC is making a mistake in hiking further rather than simply letting high rates do their thing to a heavily-indebted Canadian consumer.
Excluding mortgage interest cost, CPI rose 2.5% in May which argues that the BOC itself is the main source of inflation for Canadians.
https://www.forexlive.com/news/canada-may-cpi-34-yy-versus-34-expected-20230627/amp/