Canada's annual inflation rate slowed sharply in March after two months at or above 2%, in line with a widespread pullback in inflation expectations following a jump in the wake of President Donald Trump's election victory last fall.
The inflation report could reinforce the Bank of Canada's cautious approach to the economic outlook, and its message that considerable slack, or unused labor and production capacity, continues to weigh on wages and prices.
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The all-items consumer-price index in March increased 1.6% from a year earlier, Statistics Canada said Friday, compared with a 2% rise in February and a 2.1% advance in January. Market expectations were for a 1.8% increase in March, according to economists at Royal Bank of Canada.
On a month-over-month basis, CPI in March rose 0.2%.
Two of the three gauges of underlying, or core, inflation also advanced at a slower pace compared to the previous month. All of them remain below the 2% mark, or the Bank of Canada's inflation target.
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(END) Dow Jones Newswires
April 21, 2017 08:45 ET (12:45 GMT)