Surprise core inflation gain complicates pivot

Cautious outlook: Macklem at a news conference in Ottawa, Ontario. A majority of economists expect the BoC to keep borrowing costs unchanged, and anticipate a series of rate cuts starting in the second quarter. — Reuters

TORONTO: The rate of inflation in Canada ticked up slightly due to base effects while underlying price pressures also rose at a faster pace, highlighting a challenge for the Bank of Canada’s (BoC) campaign to restore price stability.

The consumer price index (CPI) rose 3.4% in December from a year ago, following a 3.1% increase a month earlier, Statistics Canada reported Tuesday in Ottawa. That matched the median estimate in a Bloomberg survey of economists.