This week, global leaders from the G7 group of countries will meet in Alberta, Canada, and global trade relations will be at the top of the agenda. The meeting has the potential to smooth the path towards unilateral and potentially multilateral agreements. In Canada’s case, a draft economic and security agreement has been exchanged but is not quite ready for signatures.

• Canada’s housing starts for May will be released on Monday. Housing starts for the previous month climbed much higher than expected by 30% to over 270,000 units in April compared to March.
• The Bank of Japan announces its interest-rate decision late on Monday night. Short-term interest rates were kept unchanged at its May meeting, and Japan is continuing trade discussions with the US.
• UK inflation data is released by the Office for National Statistics on Wednesday morning. The annual rate rose to 3.5% in April. Exports from the UK to the US fell sharply in May by a record 2 billion pounds.
• The Fed makes its rate decision on Wednesday afternoon and is widely expected to continue holding its federal funds rate at the current level. Minutes from the previous meeting revealed that policymakers were concerned about lower employment, economic growth and higher inflation.
• Key earnings in Canada include Currency Exchange International and Canadian Utilities. Notable earnings in the US include Lennar, Digital Turbine and ReNew Energy Global.

Although the G7 summit could help direct the tone of key trade negotiations, market observers will also be looking at incoming data and central bank moves this week. Volatility in the US economic environment could provide an opportunity for investors in Canada, according to the Chief Economist of BNP Paribas. Elsewhere, in the Middle East, a sharp escalation in tensions led to oil price fluctuations at the end of last week.

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