Forex Flash: Canada headline and Core CPI to rise further in March – TD Securities

FXstreet.com (Barcelona) - Canada will have the Consumer Price Index report available for the public and are expected to have risen further in March following the sharp move higher in February. “The all-items price index is forecast to have increased by 0.3% in the month on a non-seasonally adjusted basis. As was the case in February, seasonal factors have an important role to play in the forecast boosting the price of clothing and travel services. The price series should show a far more temperate 0.1% increase after controlling for seasonality”, wrote TD Securities analyst Annette Beacher, adding that on a year-ago basis, headline inflation is forecast to slip by a tenth of a percentage point to 1.1% due in large part to base year effects.

“Seasonality is also expected to provide the core price index with a lift, and is also forecast to have increased by 0.3% (+0.2% on a seasonally adjusted basis). This expectation balances higher food and clothing prices with the anticipated unwind in auto prices following the change in methodology that bled into February”, she continued, expecting retraction of mortgage interest costs from what was a sharp move higher in February. “On a year-ago basis, core inflation is forecast to match the February print of 1.4%”, wrote the TD Securities analyst.