July 31, 2017 / 12:49 PM / 2 years ago

Canadian producer prices fall on cheaper energy products

FILE PHOTO - An oil pump jack pumps oil in a field near Calgary, Alberta, Canada on July 21, 2014. REUTERS/Todd Korol/File Photo

OTTAWA (Reuters) - Canadian producer prices fell more than expected in June as energy and petroleum products saw their largest decline since February of last year, data from Statistics Canada showed on Monday.

The 1 percent decrease in June from May exceeded economists’ expectations for a decrease of 0.3 percent, while May’s figure was upwardly revised to show a gain of 0.1 percent from an initially reported 0.2 percent decrease.

Prices fell in 16 of the 21 major commodity groups, led by a 4.1 percent decline in the energy and petroleum sector as the cost of motor gasoline and diesel fuel declined. Excluding the energy and petroleum category, industrial prices were down 0.7 percent.

Prices for motorized and recreational vehicles fell 1.5 percent on cheaper prices for passenger cars and light trucks. The Canadian dollar has climbed in recent months, which typically lowers the cost of vehicles imported from the United States.

As some industrial prices are reported in U.S. dollars and converted into Canadian dollars, changes in the exchange rate will affect the level of the index, the statistics agency said. The index would have decreased by just 0.5 percent in June if the exchange rate was held constant.

Raw materials prices declined 3.7 percent, the largest decline since December 2015, on lower prices for crude energy products.

Reporting by Leah Schnurr; Editing by Paul Simao

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