Canada CAD

Canada Inflation Rate MoM

Info

History

Chart

Impact:

Medium

Source: Statistics Canada

Latest Release:

Date:

Big Surprise:

0.5%

CAD

Actual:

1.1%

Forecast: 0.6%

Previous/Revision:

0.1%

Period: Feb

What Does It Measure?

The Canada Inflation Rate MoM measures the change in the price level of a basket of consumer goods and services, focusing explicitly on the short-term fluctuations in consumer prices. This indicator assesses key areas like inflationary pressures, purchasing power, and cost of living, with a primary gauge being a rate above 0% indicating inflation and below 0% signaling deflation.

Frequency

This report is typically released on a monthly basis and often includes preliminary figures that may be revised in subsequent releases, with data typically available around the middle of the following month.

Why Do Traders Care?

Traders closely monitor the Canada Inflation Rate MoM as inflation is a critical determinant for monetary policy adjustments that affect interest rates, subsequently influencing key financial markets including the Canadian dollar (CAD), equities, and bonds. A higher-than-expected inflation rate can lead to bullish sentiments in currencies and stocks, while weaker readings may foster bearish conditions.

What Is It Derived From?

The Inflation Rate MoM is calculated using the Consumer Price Index (CPI), which is derived from a survey of prices collected from a wide range of consumer goods and services across Canada. This involves a systematic collection methodology where each item's price change is monitored, and the overall change is weighted based on consumption patterns.

Description

The Canada Inflation Rate MoM is particularly significant for understanding immediate inflationary trends, as it compares the current month’s prices against the previous month’s, thereby capturing short-term economic changes. This measure is essential for gauging the direct impact of economic policies and consumer behavior on inflation levels, making it a vital tool for economists and policymakers alike.

Additional Notes

This inflation measure serves as a leading indicator of economic health, reflecting consumer demand and cost pressures that can impact broader economic conditions. It is often compared to other indicators such as the annual inflation rate and core inflation metrics to achieve a comprehensive understanding of inflation dynamics in Canada and their implications worldwide.

Bullish or Bearish for Currency and Stocks

Higher than expected: Bullish for CAD, Bullish for Stocks. Lower than expected: Bearish for CAD, Bearish for Stocks. A hawkish tone: Signaling higher interest rates or inflation concerns, is usually good for the CAD but bad for Stocks due to higher borrowing costs.

Legend

High Potential Impact
This event has a strong potential to move markets significantly. If the 'Actual' value differs enough from the forecast or if the 'Previous' value is significantly revised, it signals new information that markets may rapidly adjust to.

Medium Potential Impact
This event may cause moderate market movement, especially if the 'Actual' deviates from the forecast or there's a notable revision to the 'Previous' value.

Low Potential Impact
This event is unlikely to affect market pricing unless there's an unexpected surprise or a major revision to prior data.

Surprise - Currency May Strengthen
Actual deviated from Forecast on a medium or high impact event and historically could strengthen the currency.

Surprise - Currency May Weaken
Actual deviated from Forcast on a medium or high impact event and historically could weaken the currency.

Big Surprise - Currency More Likely To Strengthen
'Actual' deviated from 'Forecast' more than 75% of historical deviations on a medium or high impact event and may likely strengthen the currency.

Big Surprise - Currency More Likely To Weaken
'Actual' deviated from 'Forecast' more than 75% of historical deviations on a medium or high impact event and may likely weaken the currency

Green Number	Better than forecast for the currency (or previous revise better)
Red Number	Worse than forecast for the currency (or previous revise better)
Hawkish	Supports higher interest rates to fight inflation, strengthening the currency but weighing on stocks.
Dovish	Favors lower rates to boost growth, weakening the currency but lifting stocks.

Date	Actual	Forecast	Previous	Surprise
Mar 18, 2025	1.1%	0.6%	0.1%	0.5%
Feb 18, 2025	0.1%	0.1%	-0.4%
Jan 21, 2025	-0.4%	-0.4%	0%
Mar 19, 2024	0.3%	0.6%	0%	-0.3%
Feb 20, 2024	0%	0.4%	-0.3%	-0.4%
Jan 16, 2024	-0.3%	-0.3%	0.1%