Canada: Consumer Price Index, December 2017

The Consumer Price Index (CPI) increased 1.9% on a year-over-year basis in December, following a 2.1% gain in November. The all-items excluding gasoline index rose 1.5% year over year in December, matching the increase in November.

12-month change in the major components

Prices were up in seven of the eight major CPI components in the 12 months to December, with the transportation and shelter indexes contributing the most to the increase. The household operations, furnishings and equipment index declined 0.3% on a year-over-year basis.

Consumer prices for transportation rose 4.9% on a year-over-year basis in December, following a 5.9% increase in November. The movement in transportation prices was led by gasoline, which rose 12.2% year over year in December, after increasing 19.6% the previous month. The purchase of passenger vehicles index increased 3.7% in the 12-month period ending in December.

The shelter index grew 1.4% on a year-over-year basis in December, after increasing 1.2% in November. The natural gas index contributed to the gain in this major component, up 6.2% in December following a 3.1% increase in November.

Consumers paid 2.0% more for food in December compared with the same month the previous year. Food purchased from stores was up 1.5% in the 12 months to December. On a year-over-year basis, higher prices for fresh vegetables (+6.9%) contributed the most to the increase. Prices for food purchased from restaurants rose 2.9% year over year in December.

Household operations, furnishings and equipment costs fell 0.3% on a year-over-year basis in December, after increasing 0.9% in November. This decline was largely due to price decreases in telephone services, down 5.0% year over year in December.

12-month change in the provinces

Consumer prices rose less on a year-over-year basis in eight provinces in December than they did in November. New Brunswick (+2.9%) and Quebec (+1.8%) were the only provinces to post a larger increase on a year-over-year basis in December, compared with the previous month.

The CPI in Alberta rose 2.0% in December on a year-over-year basis, after increasing 2.5% in November. On a month-over-month basis, the gasoline index (-6.8%) in Alberta declined the most among the provinces. Consumers paid higher prices for natural gas (+5.1%) year over year in December.

Consumer prices in Ontario increased 1.5% in the 12 months to December, following a 1.9% gain in November. The telephone services index decreased 6.5% year over year after increasing 3.3% in November, contributing to the slower growth of the CPI in Ontario. Traveller accommodation prices rose 3.0% year over year in December, following a 4.7% increase in November.

The CPI in New Brunswick rose 2.9% in December on a year-over-year basis, after increasing 2.7% in November. Among the provinces, New Brunswick recorded the largest price gain for dairy products, up 2.6% in the 12 months to December. This movement was largely attributable to a monthly decline one year earlier which no longer factors into the 12-month movement.

Seasonally adjusted monthly Consumer Price Index

On a seasonally adjusted monthly basis, the CPI increased 0.2% in December, following a 0.5% gain in November.

In December, six major components increased, while two declined. The transportation index (+0.6%) recorded the largest gain, while the household operations, furnishings and equipment index (-1.1%) registered the largest decrease.

StatsCanada

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Dean Popplewell

Dean Popplewell

Vice-President of Market Analysis at MarketPulse
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell