By Robb M. Stewart
OTTAWA--Prices for products manufactured in Canada ticked higher at the end of last year with a further fall in the local currency, while Canadian companies paid more for raw materials.
Statistics Canada's industrial product price index increased 0.2% in December from the month before, a third consecutive rise. On a 12-month basis, the producer-price index was up 4.1%.
Excluding energy products, producer prices advanced 0.4% on-month and were 5.1% higher than in the final month of 2023, the data agency said Wednesday.
The Canadian dollar depreciated roughly 1.9% against the U.S. currency in the final month of 2024. If the exchange rate had held steady for the latest month, producer prices would have dipped 0.1%.
The movement in the currency affects industries whose products are primarily priced in U.S. dollars, such the automotive and aircraft sectors.
Prices for motorized and recreational vehicles rose for a third month running, driven higher in December by gains in prices for vehicle engines and parts, and for aircraft as well as aircraft engines and other aerospace equipment. Prices were also up for primary non-ferrous metal products, lumber and other wood products, and for meat, fish and dairy products.
The advance in product prices was moderated somewhat by lower prices for energy and petroleum products, the agency said.
The industrial product price index measures the prices that manufacturers in Canada receive once their goods leave the plant. It doesn't reflect the final prices consumers pay for goods on store shelves.
Prices for raw materials, which track prices paid by manufacturers, were up 1.3% from November. Compared with a year earlier, prices for raw materials jumped 9.1%.
Prices paid for metal ores, concentrates and scrap rose 2% during December, a fourth consecutive monthly increase. Prices for crude energy products and crop products also were higher than in November.
Canada's economy likely strengthened in the final quarter of last year, bolstered by a pickup in household spending after a string of interest rate cuts that started in June along with a temporary federal tax break on sales of some items during the holiday season. An advance estimate of industry-level gross domestic product indicated activity contracted by 0.1% in November after a strong-than-expected advance of 0.3% from the prior month in October.
Write to Robb M. Stewart at robb.stewart@wsj.com
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