Tag Archive for: Inflation rate update

CPI update for June 23

Well the CPI ( Consumer price index) numbers are out for the month and it has been reported that inflation for May has gone down a full percentage point from 4.4% to 3.4%. This has been the biggest monthly change since the inflation hit the peak of 8.1% in June of 2022, and the lowest rate since June of 2021. So it now give me some confidence that we will soon hit that 2% target.

The slowing of inflation in May, led by a significant drop in gasoline prices, according to Statistics Canada. The deceleration was down from 4.4% last month, with gasoline prices being the key factor in the data. Removing gasoline, the inflation rate was 4.4%. Despite the slowdown, many facets of living costs are still increasing sharply, such as grocery prices, which rose almost 9% in May, and the cost of housing, with mortgage interest costs skyrocketing to a record 29.9% increase. Shelter costs rose 4.7%, and rent increased by 5.6% in the past year.

The decline was largely due to base year effects from the impact of Russia’s invasion of Ukraine on international energy prices. The result was in line with the Bank of Canada’s baseline scenario, which expects inflation to slow to 3% by summer. The slowdown was attributed to a decline in energy prices, particularly gasoline, and eased supply chain bottlenecks for durable goods. However, mortgage interest costs saw the sharpest hike in history, driven by the high interest of the Bank of Canada. The core inflation rate also slowed more than expected to 3.7%. On a monthly basis, the CPI rose 0.4%.

The next up in this economic chess match will be the Bank of Canada’s next policy meeting on July 12th. Despite the decrease, some economists are warning that the Bank of Canada may still raise interest rates again in July. While the cooling in inflation may ease the pressure on the bank, more information is needed to determine the effect of inflation, with June’s job data and the Bank’s own business outlook survey among the metrics to be considered. Let’s take today’s good news with a grain of salt.

Today I am thankful for some pleasing economic news, a great early morning run and a new book discovered hidden away in my house.

I look forward to hearing from you in regard to your mortgage needs.

Patrick

p.s- You can click on this link to start the process whenever you are ready. Schedule your meeting with me here.

p.s.s- I should tell you that I am licensed in Nova Scotia Brokerage (2022-3000179) Broker (2022-3000180), Ontario(M18001555) & in British Columbia(BCFSA #504098).

p.s.s.s You can download my new mortgage app here

January 2023 Inflation report

The inflationary report for January 2023 was released by Statistics Canada yesterday and we appear to be doing better than we expected. The market consensus had predicted that inflation would drop to 6.1% from 6.3% in December 2022. Actually we dropped to 5.9% which was the lowest rate since last February. So while we saw decreases in transportaion & shelter it is actually stubbornly high for food prices which are still accelerating at the fastest pace since 1981, up 10.4%.

Since the weighting of shelter & transportation in relation to food is higher ( based on spending habits from 2002) is why our overall inflationary rate dropped. The market is estimating that the rate will decrease again in February to 5.2%. If this is the case it will turn out to be the lowest rate in a year. Thus proving the the BOC’s actions are causing a reduction to spending and in turn slowing down the economy.

However it won’t be till March 8th when the Bank of Canada meets next until we know whether these new inflationary numbers are enough to cause them to pause on the rate increases. So while we can cut down on travel and other unnecessary expenses it is harder to cut back on the necessities like food. With the our dualolopy of Empire Group ( Sobey’s) and Loblaw’s ( Superstore) making record breaking profits on the backs of consumers there is little to no pressure on them to relent on increasing prices.

Bank of Canada governor even said after these numbers were released that companies must start to bring down these prices or he will be forced to keep raising rates until that happens.

Today I am thankful the rejuvenating power of exercise, kind words from clients and the knowledge that when one door closes another one is sure to open.

I look forward to hearing from you in regard to your mortgage needs.

Patrick

p.s- You can click on this link to start the process whenever you are ready. Schedule your meeting with me here.

p.s.s- I should tell you that I am licensed in Nova Scotia Brokerage (2022-3000179) Broker (2022-3000180), Ontario(M18001555) & in British Columbia(BCFSA #504098).

p.s.s.s You can download my new mortgage app here

Inflation Rate update 01/17/23

The numbers have just been released and our inflationary rate dropped from 6.8% in November to 6.3% in December. This is .1% below expectations. This is just proof that we are headed in the right direction but will it be enough for the Bank of Canada to put a pause on future rate increases. We won’t have the answer on that till next week when the Bank meets on Wednesday January 25 to tell us what they are going to do.

Note of caution that we are still well above the 2% target rate for inflation and also still up from the 5.1% rate that we had in January of 2022. All in all we should be pleased that for the past 6 reporting periods the rate has come down from the high of 8.1% achieved in June of 2022. If we keep this up we may still achieve the soft landing that the BOC has been talking about rather than a hard landing which a recession would bring.

Today I am thankful for the inflation rate coming down from it’s peak last year, starting to notice the results since I have dialled up the intensity in my workouts and a new book with some new perspectives.

I look forward to hearing from you in regard to your mortgage needs.

Patrick

p.s- You can click on this link to start the process whenever you are ready. Schedule your meeting with me here.

p.s.s- I should tell you that I am licensed in Nova Scotia Brokerage (2022-3000179) Broker (2022-3000180), Ontario(M18001555) & in British Columbia(BCFSA #504098).

p.s.s.s You can download my new mortgage app here