By The industrial product price index in Canada showed a 0.4% increase in September, driven by higher crude energy costs. On a yearly basis, the producer-price index was up 0.6%. However, excluding energy products, producer prices remained unchanged compared to the previous month, but were 0.7% higher than the previous year.
Diesel fuel prices rose due to low distillate inventories in the U.S. and Europe, while gasoline prices fell. Motorized and recreational vehicles saw a modest increase in prices as the Canadian dollar depreciated against the U.S. dollar. On the other hand, prices for meat, fish, dairy products, and primary non-ferrous metal products declined.
It is important to note that the industrial product price index reflects the prices manufacturers receive for their goods leaving the plant, not the final prices consumers pay at stores.
Meanwhile, raw material prices paid by manufacturers increased by 3.5% in September compared to August. In comparison to the previous year, raw material prices rose by 2.4% in September. Crude energy products saw a 0.4% increase in prices for the third consecutive month. However, after excluding crude energy products, raw material prices decreased by 0.2% compared to the previous month.
The Bank of Canada is expected to update its economic projections at its upcoming monetary policy meeting. Last month, the central bank kept its policy interest rate steady at 5% after a significant slowdown in the second quarter. Consumer-price inflation also cooled unexpectedly in September to 3.8%, which is above the bank’s target of 2%, but lower than the previous month.
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