Canada Producer Prices Flatten in May After Recent Increases

By Robb M. Stewart

OTTAWA--Producer prices in Canada were little changed last month after rising for four months straight, while Canadian companies paid less for raw materials.

Statistics Canada's industrial product price index was flat in May from the month before. On a 12-month basis, the producer-price index increased 1.8%, the biggest annual rise since January 2023.

The flatlining in prices reflected a drop for energy and products and for lumber and other wood products that was largely offset by increases in prices for primary non-ferrous metals and meat, fish and dairy products, the data agency said Friday.

Excluding energy products, producer prices were up 0.5% on the month before.

The industrial product price index measures the prices that manufacturers in Canada receive once their goods leave the plant. It doesn't reflect the final prices consumers pay for goods on store shelves.

Prices for raw materials, which track prices paid by manufacturers, were down 1.0% from April following four consecutive monthly increases. Compared with a year earlier, prices for raw materials increased 7.6%.

Prices for crude energy products dropped 6.4% last month, the first decrease since December 2023, driven by lower prices for conventional crude oil following a sharp increase in April.

After stalling in the second half of last year, Canada's economy resumed growing in the early months of 2024, with consumption climbing at about the same pace as the country's strong population expansion and business investment picking up. The Bank of Canada earlier this month became the first Group of Seven central bank to offer rate relief, trimming a policy interest rate that had remained at a more than two-decade high for roughly a year.

Write to Robb M. Stewart at robb.stewart@wsj.com

(END) Dow Jones Newswires

June 21, 2024 08:54 ET (12:54 GMT)

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