Canadian PPI
- Before was +0.6%
- PPI y/y +4.1% against +2.2% previously
- Commodity price index +1.3% m/m vs -0.5% expected
- Commodity price index +9.1% m/m vs +2.0% expected
The headline here is misleading as there is a significant year over year decline. Much of that is fundamental effects with last December's reading of -1.6% m/m going forward but these headline y/y numbers should hold up.
Another cause of higher commodity prices is the depreciating Canadian dollar as commodities are priced in USD and many intermediate goods are imported.
Finally, the PPI was boosted by gold prices, which should not be an important factor for the Bank of Canada:
“Prices for group metals gold, silver and platinum, and their alloys (+32.4%) contributed significantly to the IPPI's year-over-year gain in December. for safe-haven assets and falling interest rates made precious metals more attractive to investors.”
