Weekly Economic Update

For the week of March 26-30.

Canadian headline inflation in February accelerated the most it had in three years, coming in at 2.2 percent year-over-year. Consensus expectations were for a 1.9 percent increase, while January’s reading was 1.7 percent increase. The average core measures registered at 2.03 percent, coming in higher for the fifth month and marking the fastest pace since 2012. According to Statistics Canada, higher prices for gas, cars, and mortgage interest costs were the main contributors to the rise in annual inflation. On a month-over-month basis, headline inflation came in at 0.6 percent.

Meanwhile, Canadian retail sales fell short of consensus expectations in January, increasing only by 0.3 percent month-over-month to $49.9 billion, versus expectations of a 1.1 percent increase. Excluding autos, sales were up 0.9 percent. 7 out of the 11 sub-sectors of retail sales experienced an increase.

US new home sales in February came in below expectations at 618k, versus consensus expectations of 620k. The median new home price rose 9.7 percent year-over-year to $326,800, while the average selling price was at $376,700.

In this shortened work week, we will see January GDP numbers, industrial product price and the raw material price index released for Canada. In the US, scheduled releases include various Fed economic activity indices, housing measures, GDP, personal income and spending, and confidence and sentiment indices.

The Canadian dollar is trading at similar levels against its US counterpart since Friday’s market close. Today’s expected trading range for the Canadian dollar is 1.2833 – 1.2933.

Source: Bloomberg

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