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TD Securities sees Canada core CPI holding near 1.85% in July

TD Securities forecasts headline CPI at 2.9% year-on-year in July, with gasoline and food driving the rise while ex food and energy stays around 1.7%.

Reported · Written up by our desk · Central Banks

TD Securities expects Canada’s headline CPI to increase to 2.9% year-on-year in July, pointing to higher gasoline and food prices as the main contributors to the uptick.

In contrast, the firm projects Canadian core inflation measures CPI-trim and CPI-median at about 1.85%, below Bank of Canada forecasts, which it says supports a relatively benign underlying inflation picture.

TD Securities also expects the ex food and energy, or xFE, measure to hold stable at 1.7% year-on-year, and it does not anticipate a major broadening in inflation pressures based on CPI diffusion indicators.

The outlook was discussed alongside an interest-rate path focus tied to core rather than oil-driven moves, with the note that diffusion and underlying components are expected to remain contained.

Latest closeGasoline (RBOB) $2.901 ▼7.3%

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