KPMG: Concerns Over Canada's Energy Cost Pass-Through Have Not Materialized

According to Jin10, KPMG Canada chief economist Ali Jaffery said Canada's June inflation report showed limited evidence that rising energy costs had passed through to goods such as food. The June report showed inflation slowed to 2.8% in June from 3.2% in the previous month. Jaffery said economic literature suggests this pass-through may take a year or longer to peak, but a slow start is encouraging. He said concerns that goods prices would accelerate because of higher energy prices and U.S. tariffs have not been confirmed. He added that, excluding travel services, the CPI basket showed "significant weakness"; travel service prices rose in June because of World Cup matches held in Toronto and Vancouver.