Canada headline CPI
- Prior 7.0%
- CPI MoM 0.1% vs. 0.0% expected
- CPI year on year rose 6.9%. This was the 3rd consecutive monthly decline in the headline inflation. Gasoline prices are mostly responsible for the deceleration. Higher food prices offset the declines
- gasoline prices drop -7.4% in September. That followed a -9.6% decline in August (3rd consecutive month over month decline for gasoline). Year-over-year gasoline prices rose 13.2% down from 22.1% in August
- food prices rose year on year rose 11.4% which was the fastest year-over-year since August 1981 1 prices rose 11.9%
Core measures
- core CPI year on year 6.0% vs. 5.8% last month
- core CPI month-to-month 0.4% vs. a 0.0% last month
- median CPI 4.7% vs. 4.7 last month (revised from 4.8%
- trimmed CPI 5.2% vs. 5.2% last month
- common CPI 610% vs. 6.0% last month
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Canada producer prices for September showed:
- producer price is month-to-month 0.1% vs. -1.6% last month (revised from -1.2%).
- Producer prices year on year rose 9.0% vs. a revised 10.2% last month (was 10.6%)
- raw material prices month-to-month fell -3.2% vs. -4.3% last month
- will material prices year on year rose 11.0% which was down from 17.3% last month (revised from 17.6%) him.
inflation
Inflation
Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is measured by the level of the total money supply of a specific currency, for example the US dollar, which is constantly increasing. However, an increase in the money supply does not necessarily mean that there is inflation. What leads to inflation is a faster increase in the money supply in relation to the wealth produced (measured with GDP). As such, this generates pressure of demand on a supply that does not increase at the same rate. The consumer price index then increases, generating inflation.How Does Inflation Affect Forex?The level of inflation has a direct impact on the exchange rate between two currencies on several levels.This includes purchasing power parity, which attempts to compare different purchasing powers of each country according to the general price level. In doing so, this makes it possible to determine the country with the most expensive cost of living.The currency with the higher inflation rate consequently loses value and depreciates, while the currency with the lower inflation rate appreciates on the forex market.Interest rates are also impacted. Inflation rates that are too high push interest rates up, which has the effect of depreciating the currency on foreign exchange. Conversely, inflation that is too low (or deflation) pushes interest rates down, which has the effect of appreciating the currency on the forex market.
Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is measured by the level of the total money supply of a specific currency, for example the US dollar, which is constantly increasing. However, an increase in the money supply does not necessarily mean that there is inflation. What leads to inflation is a faster increase in the money supply in relation to the wealth produced (measured with GDP). As such, this generates pressure of demand on a supply that does not increase at the same rate. The consumer price index then increases, generating inflation.How Does Inflation Affect Forex?The level of inflation has a direct impact on the exchange rate between two currencies on several levels.This includes purchasing power parity, which attempts to compare different purchasing powers of each country according to the general price level. In doing so, this makes it possible to determine the country with the most expensive cost of living.The currency with the higher inflation rate consequently loses value and depreciates, while the currency with the lower inflation rate appreciates on the forex market.Interest rates are also impacted. Inflation rates that are too high push interest rates up, which has the effect of depreciating the currency on foreign exchange. Conversely, inflation that is too low (or deflation) pushes interest rates down, which has the effect of appreciating the currency on the forex market.
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