UPDATE 1-Weaker C$, costlier energy boost Canada factory prices

Mon Mar 3, 2014 8:37am EST
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* Industrial product prices +1.4 pct on month, +2.3 pct on year

* Raw material prices +2.6 pct on month, +0.1 pct on year

* Higher oil product and crude oil prices also a factor

OTTAWA, March 3 (Reuters) - A weaker Canadian dollar and higher energy prices helped boost Canadian industrial product prices and raw material prices more than expected in January, according to Statistics Canada data on Monday.

Manufacturers' prices rose by 1.4 percent from December, and 2.3 percent from a year earlier, versus economists' expectations in a Reuters survey of 0.5 percent and 1.7 percent respectively.

The federal agency noted that some producers who export their products report their price in U.S. dollars, so that a rise in the U.S. currency has the effect of boosting their prices in Canadian-dollar terms. Without the 2.8 percent fall in the Canadian dollar versus its U.S. counterpart, the index would have risen 0.7 percent instead of 1.4 percent.

Energy and petroleum products rose 2.3 percent; excluding these, industrial product prices rose 1.2 percent.

Raw material prices, which rose 2.6 percent from December and 0.1 percent on the year, also were influenced by the currency and by petroleum. Excluding crude energy products, prices rose 1.5 percent on the month. Statscan does not measure the currency effect on raw material prices, but the fall in the Canadian dollar would have boosted the index, an analyst from the agency said.

Analysts had expected raw material prices to rise 1.0 percent on the month and to be down 1.2 percent on the year.