Canada April PPI +2.0% m/m vs +1.3% expected
- Prior was 2.4% (revised to +2.8%)
- PPI Y/Y +11.4% vs +7.8% prior (revised to +8.4%)
- Raw materials price index M/M +2.6% vs +12.0% prior
- Raw material price index Y/Y +31.6% vs +23.6% prior
StatCan notes: “the PPI rose 2.0% in April, the fourth consecutive monthly increase for the index. Disruptions to shipping in the Strait of Hormuz, an important global shipping lane for petroleum and other products, exerted significant upward pressure on the prices of several commodities for the second consecutive month. Most notably, the supply disruption influenced prices for energy and petroleum products, chemicals and chemical products, and unwrought aluminum and aluminum alloys (under the primary non-ferrous metal products commodity group). Energy and petroleum products was the primary contributor to the PPI’s month-over-month increase in April. Excluding energy and petroleum products, the PPI increased 1.1% during the month."
For background, Canada’s two key producer price gauges, the Industrial Product Price Index (IPPI) and the Raw Materials Price Index (RMPI), are published monthly by Statistics Canada, typically around the 20th of the following month. The IPPI measures prices received by Canadian manufacturers for goods sold at the factory gate, excluding indirect taxes, tariffs, and downstream transportation or distribution costs. The RMPI, by contrast, captures prices paid by Canadian manufacturers for key raw material inputs, including freight, net taxes, and duties, making it a useful leading indicator for pipeline cost pressures. Both are reported on a January 2020 = 100 base and feed into the calculation of real GDP by industry in the national accounts. While the IPPI does not measure the direct impact of tariffs, cross-border duties can influence the series indirectly through input costs and supply-demand dynamics, a factor that has drawn extra attention amid recent Canada-U.S. trade frictions.
This article was written by Giuseppe Dellamotta at investinglive.com.