Inflation, BOC and Canada
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Canada's main stock index inched lower on Monday as investors avoided big bets ahead of domestic inflation data due on Tuesday and a key U.S. central bank conference starting on Friday. At 9:55 a.m. ET (1355 GMT),
Inflation eased slightly in July, but core measures remain sticky, leaving economists doubtful the Bank of Canada will change course in September.
The Federal Reserve Chair is “hurting” the housing industry “very badly,” U.S. President Donald Trump posted on Truth Social last night. “There is no Inflation,” he wrote, calling for Fed Chief “Jerome ‘Too Late’ Powell” to deliver a “major Rate Cut.”
The Canadian dollar hit its lowest in almost three weeks against its U.S. counterpart on Tuesday as oil prices fell and cooler domestic inflation data raised expectations the Bank of Canada would cut interest rates in the coming months.
Although inflation in Canada eased to the Bank of Canada’s 2% target in August, Royal Bank of Canada economists aren’t partying. They argue 2024’s 2% inflation isn’t 2019’s 2%.
Statistics Canada will issue the Consumer Price Index (CPI) for July on Tuesday. This will attract the market's attention since it will provide the Bank of Canada (BoC) with fresh information on how inflation is changing, which they use to set interest rates.
The Canadian dollar was barely changed against its U.S. counterpart on Monday as oil prices rose and investors awaited domestic inflation data that could guide expectations for the Bank of Canada policy outlook.
Consumer inflation in Canada rose by less than expected in July, according to Statistics Canada, as falling gasoline prices offset price increases elsewhere.