09:24 AM EDT, 10/22/2025 (MT Newswires) -- Tuesday's Canadian inflation figures for September were slightly higher than expected, said Commerzbank.

Due to base effects, an increase in the headline rate of over 2% year-on-year was anticipated, but the actual increase was 2.4%, which is two-tenths of a percentage point higher than expected, wrote the bank in a note to clients. Seasonally adjusted, this was the second-highest month-on-month increase since price rises began to level off.

The trimmed mean, one of the core inflation measures, also rose slightly again, pointed out Commerzbank.

The bank stated that higher -- or lower -- individual month-on-month inflation increases aren't unusual. It would be more unusual for inflation to be exactly on target all the time. On average, even after the outlier, price increases over the last two years have remained consistent with the 2% target.

Only if it becomes apparent in the coming months that Tuesday's figures weren't an exception are decision-makers at the Bank of Canada likely to become nervous, according to Commerzbank.

However, the figures do have one implication: they provide another argument against an interest rate cut next week. The BoC is slated to hold a policy meeting next Wednesday.

Most recently, labor market figures had already surprised positively and tended to favor a move in December. Although economists surveyed by Bloomberg still favor an interest rate cut in October, Tuesday's figures have made the bank even more uncertain.

For the Canadian dollar (CAD or loonie), this is a good sign, at least in the short term, aded the bank.