OTTAWA (Reuters) - Tumbling oil prices triggered a sharper-than-expected decline in Canadian industrial product and raw materials prices in September, pointing to an eventual softening of inflationary pressure on consumers down the line.
Statistics Canada said on Thursday that producer prices, the amount manufacturers receive for goods leaving the plant, fell 1.2 percent in the month versus the average forecast in a Reuters poll of a 0.4 percent decline. A 4.5 percent drop in petroleum and coal product prices heavily influenced the downturn in the producer price index.
It was the second straight fall in the index after a 0.1 percent slip in August. In the year to September, prices rose 8 percent, easing from 8.5 percent growth a month earlier. In addition to energy products, prices fell sharply for primary metal products and chemical products.
The heavyweight vehicles and transport equipment sector, which has almost a quarter of the weighting in the index, held steady with a 0.2 percent price gain.
The raw materials price index, which reflects what manufacturers pay for raw resources, slumped 7.2 percent. That was steeper than the 5 percent drop forecast by analysts but still milder than the 7.7 percent slide in August. Statscan attributed the drop to price decreases in mineral fuels. The annual rise in raw materials prices eased to 14.8 percent from 22.6 percent.
Reporting by Louise Egan; Editing by James Dalgleish