Canadian Producer Prices Tick Up in November, Driven by Currency Fluctuations
Sign up for Global Macro Playbook: Stay ahead of the curve on global macro trends.
Producer prices in Canada edged up 0.6% in November, according to Statistics Canada, as reported by the Wall Street Journal. This follows a 1.2% increase in October. On an annual basis, the producer-price index climbed 2.2%.
The increase was primarily attributed to the depreciation of the Canadian dollar against its US counterpart, with some producer prices reported in US dollars. Notably, lumber and other wood products saw the most significant month-over-month price surge since March 2022. Energy and petroleum product prices also contributed to the overall increase, driven by higher refined petroleum energy product prices.
Excluding energy products, producer prices rose 0.5% on a monthly basis.
In contrast, prices for raw materials, which manufacturers purchase, declined 0.5% from October. This decrease was largely attributed to lower conventional crude oil prices. However, prices for animals and animal products, as well as crops, experienced increases.
Despite a period of robust economic growth in the first half of 2023, Canada's economic expansion has since cooled. A preliminary estimate of industry-level gross domestic product (GDP) reveals a 0.1% month-over-month decline in November, following a 0.3% increase in October, according to data released Monday by Statistics Canada.
The industrial product price index measures the prices manufacturers receive for their goods upon leaving the plant. It does not reflect the final prices consumers pay for goods in stores.