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Special Report

Canada Inflation Research Brief

October 2022

Price Growth Continues to Soften;
Core Measures Unchanged From Last Month

Inflation remains high, but signs of moderation emerge. Annual price growth in September was 6.9 per cent, down 10 basis points when compared to August. While declining headline inflation is a positive outcome, the monthly drop failed to meet the consensus expectation. The 7.4 per cent month-over-month decrease in gas prices was largely offset by the sharp rise in food prices, which was a primary reason why overall inflation declined at a slower pace than anticipated. Regarding core CPI, annual growth rates in the Bank of Canada’s three main indicators were unchanged from last month. Nonetheless, there are signs suggesting core inflation will likely trend downward in the near future as global shipping rates have fallen, commodity prices are down and supply chains are re-establishing. With headline inflation decreasing slower than the general consensus, and core measures running hot, it is likely the BoC will continue its hawkish approach to monetary policy later this month. 

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