Technical Analysis

Canada October producer price index +2.4% vs +0.4% expected

  • Prior was +0.1% (revised to 0.0%)
  • Prices +10.1% y/y vs +9.0% prior (revised to +9.1%)
  • Raw materials price index +1.3% vs -3.2% prior
  • Raw materials price index +10.1% vs +11.0% prior

This series has been trending down after hitting 18% in March but this is an unwelcome bump, from the BOC’s perspective. It reflects the bounce in oil prices in October. Fortunately, oil has come back down so the Nov/Dec numbers should show a further decline. If commodity prices hang around these levels, the PPI will be in deeply negative territory in Q2.

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