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🇨🇦❗️Cable FX Macro Weekly Note: Canada July CPI

**As seen in Risk In The Week report 08/12/23, subscribe at

Canada's June consumer prices eased to 2.8% from the prior 3.4% Y/y, the headline metric is now within the central bank’s target range. Following the trend, core CPI is rising faster than the headline at 3.9% Y/y, and the average of trim/ median core metrics rose by 3.8%. On the month, the largest declines were recorded in clothing, household, and recreation prices. Despite inflation falling back to target, the Bloomberg consensus forecast pencils CPI rising by 3.7% in 2023, it is seen slowing down to 2.3% next year. Analysts at TD Securities expect the Bank of Canada to remain on the sidelines, this undermines their recent communication on excess demand. However, TD points at both inflation and the most recent 1.0% GDP growth undershooting the BoC’s forecast. The desk at RBC joins this call and sees the central bank unchanged for the rest of the year.



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