They anticipate that Canada's annual inflation rate will likely ease further in July.
With Tuesday’s Consumer Price Index release expected to show that inflation slowed in July, economists say the data should be enough to support a third consecutive Bank of Canada rate cut in September. With Tuesday’s Consumer Price Index release likely to show that inflation slowed in July, economists say the data should be enough to support a third consecutive Bank of Canada rate cut in September.
“Other core measures look to see slight deceleration in the yearly rates, providing some evidence that the disinflationary trend continues. Given the softening trend in inflation and sizeable output gap, there’s some downside risk to our call for headline and core inflation.” “That said, central bankers will want more signs that their preferred core inflation measures are moving lower.”
“We think the BoC will cut rates by 25 in each of the upcoming meetings in September and October.”and signalled that more cuts could be ahead if inflation continues to ease. Governor Tiff Macklem said at the time that the Bank was “increasingly confident that the ingredients to bring inflation back to target are in place.” But he also struck a more hawkish tone, economists noted, flagging that downside risks to the economy are taking more weight in the Bank’s future rate decisions.
Inflation Rate Core Inflation BMO Capital Markets Headline Inflation CPI Data Consumer Price Index
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