The short week will bring with it plenty of critical economic announcements out of Canada, which will help guide the Bank of Canada’s (BoC) next interest rate decision on June 10. Geopolitical tensions will continue to take centre stage as the US and Iran have been unable to reach an agreement to end the conflict between them, while the US and China consider their respective relationships with Taiwan. Financial markets were jittery at the end of last week with oil prices continuing to increase, raising concerns that inflationary pressures could go higher and might force central banks to raise interest rates.

• Canada’s inflation rate for April will be released today. The annual inflation rate rose to 2.4% in March from 1.8% in February. Economists are expecting more upward pressure in the months to come.
• Retail sales in Canada will be announced on Friday. Retail sales have risen each month in 2026. However, the pace of growth slowed as the first quarter of 2026 progressed.
• The US will release several critical economic indicators, many of which are from the real estate market. These include pending home sales, housing starts and building permits.
• Elsewhere, the UK and European inflation rates will be released on Wednesday, Japan’s trade balance on Wednesday night, European services sector activity on Thursday and Mexico’s economic growth rate on Friday.
• Notable earnings in Canada include Lightspeed Commerce and CAE. Key earnings in the US include The Home Depot, Target, NVIDIA and Walmart.

Canadian consumer price data will be a closely watched measure this week as markets look to predict the next move from the BoC. At its last meeting, the BoC said it expects inflation to creep up to 3.0% before coming back down next year. Higher inflationary pressures could put pressure on Canadian households, which might have markets paying extra attention to the retail sales report.

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