Inflation Expected to Tick Up in February Before Moderating Later in 2022

• Economists expect inflation likely rose again in February to 3.1% due to higher gas prices, after slowing to 2.9% in January

• The return to the 2% inflation target will likely be bumpy over the next few months as energy prices fluctuate

• The Bank of Canada is expected to cut interest rates in coming months but wants clear evidence inflation is heading to 2% before doing so

• Oil price changes make inflation forecasts uncertain; the federal budget the week after the April rate decision could also affect outlook

• February's inflation report is the last before the Bank's critical April decision on rates; a rate cut is expected in June but the Bank wants to be cautious about signaling that in April