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Canada's headline inflation rate slowed in line with forecasts, easing to a pace of 2.7% in April, Statistics Canada reported.

The reading was in line with the consensus forecast and down from March's headline reading of 2.9%.   

The Bank of Canada's preferred measures of core inflation, CPI-trim and CPI-median, also continued to ease. CPI-median slowed to 2.6% (from 2.9% in March) and CPI-trim came in at 2.9% (from 3.2%).

Shelter costs continue to be the biggest upward contributor to overall inflation but did ease slightly to an annual pace of 6.4%, down one tenth from March. Rent inflation eased to a pace of 8.2%, as did mortgage interest cost, which slowed to an annual pace of 24.5%.

"April was another month of good news on Canadian inflation," noted Leslie Preston of TD Economics. "However, at 2.8% it is still close to the top of the BoC's range, and we expect the bank will want to see a bit more confirmation before taking rates lower and lean towards a July cut."

May inflation data will be released on June 25, 2024