Bank of Canada

Regular page >>
      

Rates and Statistics

Monetary Policy Indicators

Indicators of Capacity and Inflation Pressures for Canada

The Bank of Canada monitors a wide range of indicators in assessing the extent of pressures on capacity and inflation.The Bank's conventional estimate of the output gap provides an overall assessment of the degree of slack in the economy, but this estimate is subject to considerable uncertainty. This uncertainty is addressed by considering a wide range of indicators in various markets. Many of these indicators are derived from data published by Statistics Canada, but some reflect information gathered by the Bank's regional representatives as well as by various outside sources. For further discussion of uncertainty as well as the information and analysis used to inform monetary policy decisions at the Bank of Canada, see Jenkins and Longworth1 (2002) and Macklem2 (2002).

1. Jenkins, Paul and David Longworth, "Monetary Policy and Uncertainty." Bank of Canada Review, Summer 2002: 3-10.
2. Macklem, Tiff, "Information and Analysis for Monetary Policy: Coming to a Decision." Bank of Canada Review, Summer 2002: 11-18.

(Sources) (Printer-friendly tables)

Note: The following tables are updated two days after the Bank's most recent announcement date for the target overnight rate, based on information available up to that date. When there is a Monetary Policy Report, the tables are updated on the release date of the Report, again based on information available up to the last fixed announcement date.

Updated: 26 May 2006
Next update: 13 July 2006

Inflation (year-over-year percentage change)
Selected definitions, graphs
and historical data
2004Q2 2004Q3 2004Q4 2005Q1 2005Q2 2005Q3 2005Q4 2006Q1 2006Q2 Latest data
Core inflation 1.71.61.61.81.61.61.61.7 1.6Apr
CPI excluding food, energy, and the effect of changes in indirect taxes 1.21.11.11.41.21.41.41.4 1.6Apr
CPIW 1.81.71.81.71.71.91.81.8 1.7Apr
Weighted median 1.21.51.81.91.72.22.12.5 2.3Apr
CPI Inflation 2.22.02.32.11.92.62.32.4 2.4Apr
Chain price index for GDP 3.53.43.52.82.33.14.1  4.1Q4
Chain price index for consumption 1.71.41.91.71.31.81.5  1.5Q4
Chain price index for consumption excluding food and energy 1.21.00.90.90.80.90.8  0.8Q4


Product market
Selected definitions, graphs
and historical data
2004Q22004Q32004Q42005Q12005Q22005Q32005Q42006Q12006Q2Latest data
Output gap (Bank of Canada's conventional measure) 0.20.30.20.10.20.30.20.3 0.3Q1 *
Capacity utilization rate Non-farm goods (%) (1987-2001 avg. = 83.35) 85.686.686.386.285.786.186.3  86.3Q4
Manufacturing (%) (1987-2001 avg. = 81.80) 83.084.884.484.883.884.184.7  84.7Q4
Bank of Canada Regional Office Survey Difficulty meeting and unanticipated increase in demand/sales (% firms) 46.043.045.037.043.045.549.644.6 44.6Q1
Unfilled orders/shipments - Manufacturing excluding aerospace products and parts 0.530.530.520.530.550.570.570.59 0.60Mar
Aggregate stock-to-sales ratio 0.6240.6300.6460.6490.6460.6330.622  0.622Q4
* As shown in the most recent issue of the Monetary Policy Report.


Labour market
Selected definitions, graphs
and historical data
2004Q22004Q32004Q42005Q12005Q22005Q32005Q42006Q12006Q2Latest data
Unemployment rate (%) 7.27.17.17.06.86.86.56.4 6.4Apr
Participation rate (%) 67.767.467.567.367.267.167.167.1 67.2Apr
Growth in employment (annualized rate, %) 2.60.61.40.91.71.52.41.6 0.1Apr (1)
Skilled labour shortage (% firms) - Manufacturing (Statscan survey) 5.07.07.05.07.08.09.06.08.08.0Q2
Labour shortage (% firms) - All sectors (Bank of Canada Regional Office Survey) 37.044.036.033.036.051.049.044.0 44.0Q1
1. Percentage change at monthly rate.


Wages and costs (year-over-year percentage change)
Selected definitions, graphs
and historical data
2004Q22004Q32004Q42005Q12005Q22005Q32005Q42006Q12006Q2Latest data
Labour Force Survey - average hourly earnings (unweighted) All employees 2.92.12.32.72.73.63.93.4 3.1Apr
Permanent employees 3.12.12.72.92.83.43.63.2 3.1Apr
Wage settlements - Private sector 2.51.02.72.32.62.72.12.5 2.6Mar
Compensation per hour - Business sector -0.30.82.32.84.65.15.4  5.4Q4
Unit labour costs - Total economy (labour income/GDP at market prices) 1.30.81.11.42.12.83.3  3.3Q4
Unit labour costs - Business sector 0.70.41.01.22.02.83.3  3.3Q4
Bank of Canada commodity price index Total 23.825.324.217.514.627.731.517.0 13.8Apr
Energy 18.928.539.227.230.662.857.327.9 15.3Apr
Non-energy 28.122.712.49.61.5-1.66.26.8 12.3Apr


Real estate market (year-over-year percentage change)
Selected definitions, graphs
and historical data
2004Q22004Q32004Q42005Q12005Q22005Q32005Q42006Q12006Q2Latest data
New-housing price index 5.85.95.45.14.74.75.67.0 7.6Mar
Resale-housing prices: www.royallepage.com 7.35.95.76.26.76.87.38.5 8.5Q1
Vacancy rate apartments (%)   2.7   2.7  2.7Oct
offices (%) 11.111.010.610.39.58.98.27.4 7.4Q1
industrial market (%) 4.74.84.94.54.54.64.44.3 4.3Q1


Expectations (year-over-year percentage change)
Selected definitions and graphs
2004Q22004Q32004Q42005Q12005Q22005Q32005Q42006Q12006Q2Latest data
www.conferenceboard.ca
Percentage of firms expecting price increases over the next six months of:
1% or less 1213142210789 9Q1
2% or less 6672745765374952 52Q1
3% or less 9594969293848895 95Q1
more than 3% 4647516127 7Q1
www.consensuseconomics.com
CPI inflation: Consensus Forecasts
2006    1.91.92.12.32.0 1.8Apr
2007        1.8 1.8Apr
2-3 years 2.0 1.9 1.9 2.0 2.02.0Apr
6-10 years 2.0 2.0 2.0 2.0 2.02.0Apr
Bank of Canada Regional Office Survey — Percentage of firms expecting CPI inflation over the next two years to be: Less than 1% 00001002 2Q1
1-2% 2233293318101415 15Q1
2-3% 5554566068606163 63Q1
more than 3% 1791247271918 18Q1
Expectations implicit in real/nominal bond spread 2.92.92.72.72.62.42.62.72.72.7May