RENNIE OUTLOOK 2024
INFLATION
After peaking at 8.1% in the summer of 2022, Canada’s rate of consumer price inflation has fallen significantly, to 3.4% most recently. Of course, this leaves inflation on the outside looking in at the Bank of Canada’s target range of 1-3%, but it’s now just a matter of time before price changes, broadly-defined, settle into a more moderate pace of growth. Notably, shelter costs—which constitute 30% of the Consumer Price Index (CPI) basket of goods and services—are driving the current headline rate of inflation, with mortgage interest costs in particular rising in the neighbourhood of 30% on a year-over-year basis. Excluding this component of the CPI yields an “everything-else” inflation rate of 2.5%, with this rate having been below the 3% threshold for seven of the past eight months.
OUR 2024 OUTLOOK
Our baseline expectation for Canada’s inflation rate is for it to dive below 3% by Q2 2024, where inertia suggests it is likely to remain for the remainder of the year. While the high end of our estimates suggests inflation could poke past 3% as the year progresses, there will be enough moderation to pave the path for meaningful interest rate cuts.
Copyright © 2024 rennie group of companies. All rights reserved. This material may not be reproduced or distributed, in whole or in part, without the prior written permission of the rennie group of companies. Current as of February 5, 2024. Data from the Greater Vancouver and Fraser Valley Boards, Statistics Canada, Zonda Urban, CMHC, & rennie. While the information and data contained herein has been obtained from sources deemed reliable, accuracy cannot be guaranteed. rennie group of companies does not assume responsibility or liability for any inaccuracies. The recipient of the information should take steps as the recipient may deem necessary to verify the information prior to placing any reliance upon the information. The information contained within this report should not be used as an opinion of value, such opinions should and can be obtained from a rennie and associates advisor. All information is subject to change and any property may be withdrawn from the market at any time without notice or obligation to the recipient from rennie group of companies. E.&O.E. 11
Made with FlippingBook - professional solution for displaying marketing and sales documents online