Canadian CPI and retail sales data is due on Friday
At 1230GMT
Previews of the CPI via
RBC:
- We expect a marginal 0.1% m/m gain in headline CPI for September, which would edge the YoY rate down to 2.7%. Seasonals have a strong-and mostly offsetting-impact in the month, including clothing & footwear and tuition fees (positive) and fruit & vegetable prices (negative). The latter should see their YoY rate increase, as the seasonal decline should be less than last year. A more pronounced moderation in airfares is expected after July's 16.4% m/m gain was followed by deline of only 2.0% m/m in August. Gas prices appear to have been close to flat in the month, but that should see the category's YoY rate move down from ~20% to closer to 13%. All three of the BoC's core measures rose 0.1pp in August (average of 2.1%) and we see them continuing to show underlying inflation around 2%, as they have since February.
HSBC
- We expect consumer prices to rise by 0.1% in September. There is very little of an average seasonal effect on consumer prices in the month. That said, food prices and travel services prices tend to decline in September, while clothing prices and tuition prices tend to rise. In the month, gasoline prices fell by 0.4%, which should be largely offset by an expected 0.6% increase in mortgage interest costs. With the small gain in prices in September, we think that annual rate of inflation will dip to 2.7%, from the prior 2.8%. This will continue the ongoing decline from the seven year high of 3.0% in July
