VIEW Canada's annual inflation in March edges up to 2.9%

April 16 (Reuters) - Canada's annual inflation rate edged up to 2.9% in March on higher year-over-year prices for gasoline, as well as mortgage interest costs and rent, Statistics Canada said on Tuesday.

Analysts had expected annual inflation to rise to 2.9% from 2.8% in February.

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COMMENTARY

JULES BOUDREAU, SENIOR ECONOMIST, MACKENZIE INVESTMENTS

"In our opinion we are in the June camp, I think July is also possible because it is soon after the monetary policy review coming with it. But I think June is still likely especially after what the governor said during the press conference of the recent policy decision. Where he (Governor Tiff Macklem) said we (BOC) were not looking to see anything different but just looking to see more of what we saw over the past few months. And that is exactly what we have got."

"This is a few in a row now of readings where inflation is surprising on the downside. The Bank of Canada's preferred core measures also edged lower in the latest months so it's confirming that we're not seeing the same re-acceleration in price growth in Canada that we have been seeing in the U.S. in recent months."

"The economic growth backdrop still looks very weak, the unemployment rate has been rising. And inflation does look like it's continuing to slow so all that leaves nearer-term rate cuts from the Bank of Canada in play in a way that it's not so much in the United States."

"Not bad. I wouldn't say it's quite as good as the prior two months but still was no worse than expectations. Perhaps most encouraging is we did see some moderation in most of the major measures of core. Having said that, it's not all great news when you see six-tenths rise in a single month."

"I don't think it'll create a big problem for (Bank of Canada). We think that a June rate cut is possible. I still think that's a reasonable expectation."

"The Canadian economy continues to make progress on the inflation front, so the question is, is this enough evidence for Bank of Canada to feel comfortable for lowering rates or not. We will get another print on CPI before the next BOC meet, we think the BOC will err on the side of caution right now. We think that it makes sense given how long they have overshot the inflation target to be very sure that they have fully extinguished inflation before lowering rates. But it is certainly consistent with a mid year rate cut."