Canada: Retail sales and CPI in the limelight - TDS

Analysts at TDS suggest that retail sales for April and May CPI from Canada will provide an update on growth conditions and inflation ahead of the July BoC.

Key Quotes

“We see modest downside risks to retail sales on a pullback in motor vehicle sales, which should leave sales down 0.2% m/m while ex-auto sales post a 0.3% gain (market: 0.0%, 0.5%).”

“We expect CPI to print in line with market expectations at 2.6% y/y, with prices up 0.4% m/m. Gasoline prices account for much of the strength in the monthly print and food prices should also make a positive contribution, leaving ex. food & energy measure up 0.2% m/m, though broader (BoC) measures of core inflation will be hard pressed to move any higher.”