Canada June CPI YoY 2.8% vs 2.9% estimate

Canada’s June CPI came in slightly below expectations, reinforcing the view that inflation is cooling and reducing pressure on the Bank of Canada to stay aggressive. Headline CPI fell 0.4% month over month and slowed to 2.8% year over year versus 2.9% expected, down from 3.2% in May. Core measures also eased modestly. The decline was driven mainly by slower gasoline price gains and a 10.2% monthly drop in fuel prices amid softer global oil prices. Excluding gasoline, inflation was steady at 2.2%, suggesting underlying price pressures remain contained. Travel-related categories were a bright spot due to World Cup demand, but the overall tone was disinflationary. In markets, USDCAD rose after the release and moved back above its 100-hour moving average at 1.4040, signaling a bullish near-term technical response for USD against CAD.