Canada’s CPI in October showcased a slowdown, dropping from 3.8% yoy to 3.1% yoy, falling slightly below market expectation of 3.2% yoy. This deceleration in inflation is primarily attributed to a significant reduction in gasoline prices, which decreased by -7.8% yoy. When gasoline is excluded from the equation, the CPI exhibited only a marginal decline, easing from 3.7% yoy to 3.6% yoy.
The breakdown of CPI data reveals contrasting trends between goods and services. Prices for goods saw notable deceleration, moving from 3.6% yoy to 1.6% yoy, with lower gasoline prices playing a major role in this decrease. Conversely, prices for services experienced acceleration, rising from 3.9% yoy to 4.6% yoy. This increase in service prices was driven largely by costlier travel tours, rent, property taxes, and other special charges.
In terms of the core inflation measures, CPI median aligned with expectations, slowing from 3.9% yoy to 3.6% yoy. CPI trimmed, which eliminates the most extreme price movements, showed a reduction from 3.7% yoy to 3.5% yoy, coming in slightly below anticipated 3.6% yoy. Meanwhile, CPI common, which tracks common price changes across categories, also slowed down from 4.4% yoy to 4.2% yoy, falling below expected 4.3% yoy.
