Canada Producer Prices Continue to Rise Amid Meat, Metal and Vehicle Increases

Canada's producer prices rose 0.5% in August, driven by increases in meat, metal products, and vehicles, despite lower energy prices. The producer-price index climbed 4.0% YoY, an 11th straight increase. Prices for raw materials were down 0.6% MoM but up 3.2% YoY. The data agency also reported a 1.6% contraction in Q2 GDP, with consumer inflation accelerating to 1.9% YoY in August.

Canada's producer prices rose 0.5% in August, according to data released by Statistics Canada Industrial product and raw materials price indexes, August ...^[1]. This monthly increase was driven by higher prices for meat, fish, and dairy products, motorized and recreational vehicles, and primary non-ferrous metal products. Despite these increases, lower energy and petroleum prices moderated the overall growth in the Industrial Product Price Index (IPPI).

The IPPI climbed 4.0% year-over-year (YoY), marking the 11th consecutive annual increase. This year-over-year growth was largely influenced by the prices of unwrought gold, silver, and platinum group metals, and their alloys, which rose by 36.3%. Additionally, fresh and frozen beef and veal, and fresh and frozen poultry of all types, also contributed significantly to the year-over-year increase.

On the other hand, prices for raw materials purchased by manufacturers operating in Canada, as measured by the Raw Materials Price Index (RMPI), declined 0.6% month-over-month (MoM) in August. However, the RMPI rose 3.2% YoY, driven by gains in gold, silver, and platinum group metal ores and concentrates, and cattle and calves.

The data agency also reported a 1.6% contraction in Q2 GDP, with consumer inflation accelerating to 1.9% YoY in August. This indicates that while producer prices are rising, the overall economic growth has been slowing, and consumer prices are increasing at a faster pace.

References

Industrial product and raw materials price indexes, August ...^[1] https://www150.statcan.gc.ca/n1/daily-quotidien/250922/dq250922a-eng.htm
Canada Producer Prices Rise Moderately in August^[2] https://www.tradingview.com/news/te_news:486915:0-canada-producer-prices-rise-moderately-in-august/