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--Producer prices rise 0.2%, versus expectations of 0.1% gain
--Gains offset by declines in nickel and aluminum prices
--Raw material prices drop 1.6% on lower crude
By Paul Vieira
Monthly producer prices in Canada rose in March at a slightly faster pace than anticipated, with gains in prices for petroleum and coal products offset by declines in nickel and aluminum, Statistics Canada said Monday.
The industrial product price index climbed 0.2% in March. The consensus call among traders was for a 0.1% monthly advance, according to economists at Royal Bank of Canada. Data for February were revised upward, indicating producer prices in the month gained 0.3%, versus the original 0.2% estimate.
Despite the March increase, the data agency said the index remained below a recent 2011 peak, and the year-over-year advance stands at a relatively meagre 0.9%. "Overall, industrial product price growth remains non-threatening," said Ryan Brecht, an economist at Action Economics.
The index, as measured by Statistics Canada, reflects the prices that producers in Canada receive as goods leave the plant gate.
The March increase in producer prices was primarily the result of higher petroleum and coal products, up 1.8%. Other categories that climbed included food, vegetable and feeds, 0.8%; and wood products, 0.7%.
Offsetting those gains was a 1% decline in primary metal products, led by drops in prices for nickel products, 8.8%, and aluminum, 1.2%. The drop in nickel and aluminum was linked to weaker economic activity in Asia.
The data agency said the exchange rate had a "negligible" impact on the product price index.
Meanwhile, prices for raw materials used by manufacturers fell 1.6%, the second straight monthly decline, due to lower prices for mineral fuels - most notably crude petroleum. Traders had anticipated raw materials prices would advance 0.3% in the month. On a year-over-year basis, the raw materials price index in March was down 5.6% - or the first decrease since October 2009.
-By Paul Vieira, Dow Jones Newswires; 613-237-0669; [email protected]