RTTNews - Canadian industrial and raw materials prices fell in April, halting their upward movements since the start of the year, according to data released Monday morning by Statistics Canada.
The Industrial Product Price Index (IPPI) and the Raw Materials Price Index (RMPI) were both down 0.5% in April compared with March.
The Industrial Product Price Index was mainly pulled down by the appreciation of the Canadian dollar in relation to the US dollar, and the Raw Materials Price Index was affected by lower prices for mineral fuels.
The IPPI fell 0.5% in April, a slight downturn following increases of 0.4% in February and 0.3% in March.
The decline in the IPPI was led by lower prices for motor vehicles and other transport equipment (-2.2%) and pulp and paper products (-2.3%). These two product groups are more affected by fluctuations in the exchange rate.
The Canadian dollar rose 3.3% in April in relation to its US counterpart. Some Canadian producers who export their products to the United States are generally paid in prices set in US dollars.
Consequently, the relative weakness of the US dollar in relation to the Canadian dollar had the effect of reducing the corresponding prices in Canadian dollars. If the exchange rate used to convert these prices had remained unchanged, the IPPI would have risen 0.3% instead of declining 0.5%.
The effect of the appreciation of the Canadian dollar on the IPPI was offset in part by an increase in prices for primary metal products and petroleum and coal products.
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