August 29, 2012 / 12:37 PM / 6 years ago

Canada industrial prices drop for third month in a row

A worker prepares an area for maintenance at the Cenovus Foster Creek SAGD oil sands operations near Cold Lake, Alberta, July 9, 2012. REUTERS/Todd Korol

OTTAWA (Reuters) - Canada’s producer price index dropped for the third month in a row in July, falling 0.5 percent from June on lower prices for chemical products and motor vehicles, Statistics Canada said on Wednesday.

Market analysts expected a rise of 0.1 percent. Without the effect of the Canadian dollar’s 1.4 percent increase in value against the U.S. dollar in July, the price index would have dropped by 0.2 percent.

Of the 21 major commodity groups, three were up, 14 fell and four were unchanged. Chemical products fell by 2.6 percent on lower prices for industrial chemical products and fertilizers, while motor vehicles dropped by 1.3 percent.

Raw material prices increased by 0.9 percent, the first month-on-month advance in six months, on higher prices for crude oil and vegetable products.

Compared with July 2011, industrial product prices were up 0.3 percent, but down from the 0.4 percent year-on-year growth recorded in June. Raw material prices were down 10.0 percent, largely due to a drop in crude oil, compared with the 11.8 percent fall in June 2012 prices from June 2011.

Reporting by David Ljunggren; Editing by Jeffrey Benkoe

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