OTTAWA — Statistics Canada will reveal today how the country’s official measure of inflation fared in August, with expectations for another month of near-zero readings.
In July, the annual pace of inflation stayed largely grounded at 0.1 per cent as gasoline prices stayed low and air travel prices tumbled for the first time in five years.
August isn’t expected to be much different with the average economist estimate predicting a year-over-year increase in the consumer price index of 0.4 per cent, according to financial data firm Refinitiv.
The Bank of Canada intends to keep its key policy interest rate at 0.25 per cent, which is as low as it will go, until inflation is back at the central bank’s two per cent target.
The hope is that by keeping its rate low, the central bank can drive down rates on mortgages and loans to make it easier for people to borrow and spend to aid the economy as it recuperates from the COVID-19 crisis.
Experts suggest the Bank of Canada’s key rate could stay where it is until late 2022 or even into 2023.
This report by The Canadian Press was first published Sept. 16, 2020.
