Canadian Inflation Cools More Than Expected

(MENAFN- Yolo Wire) Canada’s central bankers received a jolt of sharply falling prices ahead of next week’s policy-setting meeting. The country’s %Inflation cooled sharply for a second month, with the September print falling below the central bank’s target for the first time in more than three years and increasing expectations of an outsize interest-rate cut.

Gasoline prices drove inflation lower, while core prices—which exclude the volatile food and energy categories—stayed the same. At 1.6 percent, the number is below the bank of Canada’s 2 percent target and raises fears of a slowing economy. Shelter price inflation was lower than August but still high at 5.0 percent.

At its last three policy-setting meetings, the Bank of Canada has trimmed its policy rate by 25 basis points. In September, Governor Tiff Macklem said there were risks that inflation could fall below its target range and economic growth could weaken, raising hopes for a larger-than-usual 50 basis-point rate cut.

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