Canada Inflation (CPI)

Canada inflation (CPI) is the most important data released each month for the Canadian dollar. The consumer price index shows how much more expensive the basket of goods and services bought by Canadian households has become compared with the previous month and year. A distinctive feature of this report is its three core inflation measures, which the Bank of Canada looks at for its interest rate decisions. At the top of this page you can see the next release time of Canada's CPI with a countdown in Tehran time, the latest actual figure and forecast, and a history chart; this guide explains how to read these numbers.

What is Canada's CPI and who publishes it?

This index is published by Statistics Canada. The headline figure is the price change of the entire consumer basket, from food and rent to gasoline and services. Because energy prices and some seasonal items swing sharply up and down, the overall figure sometimes doesn't give an accurate picture of the inflation trend. That's why the Bank of Canada (BoC), alongside the headline figure, also tracks several core measures that reduce the effect of these swings.

The Bank of Canada targets annual inflation of 2%, at the midpoint of a 1% to 3% range. The further inflation figures are from this target, the more likely the bank is to change its policy at the Bank of Canada interest rate decision .

Canada inflation release time in Tehran time

Canada's inflation report is released monthly, usually in the third week of the month, and covers the previous month. The release time is 8:30 a.m. Eastern Time in Canada; that is, 16:00 Tehran time in the months when Canada observes daylight saving time and 17:00 for the rest of the year. Iran doesn't observe daylight saving time, so this one-hour shift is due only to Canada's clock change. You can see the exact date each month in the Teagle economic calendar or in the countdown on this page.

Headline inflation and three core measures: which matters more?

Several figures are released at the same time in the calendar, and each has its own use:

Calendar title	What it shows
CPI m/m	Monthly change in the whole price basket; the headline figure most media report.
Trimmed CPI y/y	Annual inflation after excluding the items with the largest and smallest price changes.
Median CPI y/y	The price change of the median item; that is, the point where half the basket rose more and half rose less.
Common CPI y/y	The common component of price changes across all items in the basket.
Core CPI m/m	Monthly change excluding volatile items such as energy and some food.

For forecasting the central bank's behavior, the two measures Trim and Median carry more weight, and the bank has relied mostly on these two in recent years. The headline figure may fall because of lower gasoline prices while these two measures stay high; in that case the market usually pays more attention to the core measures. The "Trimmed Core Inflation YoY" chart at the top of the page shows the trend of this measure based on official Statistics Canada data.

What should the actual figure be compared with?

As with any other data, the market's reaction depends on the gap between the actual figure and the forecast, not on whether the figure itself is high or low. The monthly nature of the headline figure also matters: one high-inflation month alone doesn't make a trend, but if core measures come in above expectations for several months in a row, the market shifts its interest rate expectations. To understand the general mechanism of this effect, read the article The effect of inflation on financial markets .

The effect of Canada inflation on the Canadian dollar and markets

This news has its biggest effect on the Canadian dollar, usually seen in the US dollar to Canadian dollar (USD/CAD) pair. Higher-than-expected inflation increases the likelihood of a higher interest rate or a later rate cut and usually tends to strengthen the Canadian dollar; in that case USD/CAD falls. Lower-than-expected inflation works the other way. These are tendencies, not rules: if there is important US news or a sharp move in oil prices at the same time, the effect of Canada's inflation can fade. The effect of this news on gold, global indices and crypto is usually limited. See the Bank of Canada's latest rate alongside other banks on the central bank interest rates page.

Risk notes for trading during the news

• In the first minutes after the release, spreads on Canadian dollar pairs widen and orders may be filled at worse prices.
• Sometimes the headline figure and the core measures point in opposite directions, and the market swings back and forth between the two directions in the first few minutes.
• Set your position size with the trader's calculator so that even with a price spike, your loss doesn't exceed your risk limit.
• If you trade the Canadian dollar, follow the Canada employment report as well; the central bank weighs inflation and the labor market together.

This page is for information about the timing and meaning of the news and is not a buy or sell recommendation.