Canada's April Industrial Product Price Index Falls for First Time After Six Months of Gains

April's prices of products manufactured in Canada, as measured by the Industrial Product Price Index (IPPI), declined 0.8% month-over-month and increased 2.0% year-over-year, said the country's statistical agency on Thursday.

The IPPI fell 0.8% month over month in April, after posting six consecutive months of increases, wrote Statistics Canada in a statement.

As prices for some products in the IPPI are reported in US dollars, changes in the CAD-USD exchange rate can exert an influence on the index, pointed out StatsCan. The Canadian dollar appreciated 2.7% against the US dollar from March to April. If the average monthly exchange rate had remained constant from March to April, the IPPI would have declined 0.5% month over month instead of decreasing 0.8%.

Prices for energy and oil products had the largest downward impact on the IPPI in April, decreasing 3.6% month over month.

If the average monthly exchange rate had remained constant from March to April, the IPPI excluding energy and oil products would have decreased 0.1% month over month instead of 0.5%.

The IPPI increased 2.0% year over year in April. This was the seventh consecutive year-over-year increase, stated the Ottawa-based agency.

Unwrought gold and gold alloys (+40.9%) were the subgroup with the largest contribution to the IPPI's year-over-year gain in April. Gold prices were supported by strong investment demand over the 12 months ending in April. Other key upward contributors included unwrought silver and silver alloys (+19.8%), unwrought aluminum and aluminum alloys (+18.0%), and fresh and frozen beef and veal (+13.9%).