Canadian industrial and raw materials prices rose in March compared with February, due to the depreciation of the Canadian dollar against the US dollar and higher prices for resources, according to data released Wednesday morning by Statistics Canada.
The Industrial Product Price Index (IPPI) rose 0.3% in March following a 0.5% increase in February.
The IPPI edged down 0.1% in March compared with the same month a year earlier, marking a change in direction compared with the increases observed in the previous 11 months.
Motor vehicles and other transport equipment rose 0.9%, as a result of the depreciation of the Canadian dollar in relation to its US counterpart. Prices for primary metal products increased 1.3%, pushed up by copper and copper alloys in primary forms. These increases were offset in part by lower prices for metal fabricated products, petroleum and coal products as well as chemical products.
The Canadian dollar lost 1.5% of its value against the US dollar in March. Some Canadian producers who export their products to the United States are paid in prices set in US dollars. Consequently, the relative strength of the US dollar in relation to the Canadian dollar had the effect of inflating the corresponding prices in Canadian dollars. If the exchange rate used to convert these prices had remained unchanged, the IPPI would have declined 0.1% instead of rising 0.3%.
The Raw Materials Price Index advanced 12.1% compared with February, pushed up by a strong increase in crude oil prices. Raw materials prices rose from the growth rates of 1.5% in January and 1.6% in February. Almost all the growth in March was attributable to mineral fuels.
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