Inflation fell to 12.6% in October, after 13.7% in September. The October result represents the weakest inflation rate since February. Slower growth in food and non-food prices has offset rising inflation in the services sector.
The trend was up, with annual inflation averaging 13.2% in October (September: 12.8%). Meanwhile, core inflation fell to 16.2% in October from 17.1% in September.
Finally, consumer prices rose 0.18% in October from the previous month, accelerating from a 0.05% rise in September. The October number was the highest reading since April.
Commenting on the inflationary outlook, analysts at Goldman Sachs said:
In line with CBR forecasts, we believe inflation will decline to 12.0% by the end of the year and further towards the 4.0% target in the first quarter of 2023 due to existing impacts. However, we believe it will then rise close to 7.0% by the end of 2023 and the Central Bank of Canada will raise rates from the middle of next year.
FocusEconomics panel members see inflation at 7.7% in 2023, unchanged from last month’s estimate, and 6.0% in 2024.