The Canadian federal government tabled its 2026-27 budget late last week. Canada intends to spend a net new $151.5 billion over the next five years to boost investment, improve affordability and make it less dependent on the US. New US tariffs from August have shown an impact on select sectors, which is weighing on Canada’s economic activity and labour market. Looking at the week ahead, there are few economic announcements out of Canada but some critical ones elsewhere, including the US consumer price index report.

• A final reading of Canada’s manufacturing and wholesale sales for September will be released this Friday. Manufacturing sales edged higher in August, while wholesale sales fell sharply. Both measures will give insight on overall demand in the economy.
• The US inflation rate for October will be announced on Tuesday. The annual inflation rate rose to 3.7% in September, largely in response to surging energy prices amid the conflict in the Middle East.
• Looking around the world, China’s trade balance will be released tonight, the UK’s gross domestic product on Thursday and European economic growth on Friday.
• Notable earnings in Canada include Barrick Mining, Franco-Nevada, Canadian Tire and Brookfield. Key earnings in the US include Constellation Energy and Cisco Systems.

Financial markets were choppy last week, seeing lots of volatility, as investors tried to predict how the Democrats’ win of Congress will impact the economy, geopolitics and AI. In Canada, analysis of the federal budget will continue as it is debated in Ottawa. A growing deficit and debt remains a risk, but lawmakers believe it is needed to support Canadian households and businesses against significant geopolitical and trade tensions.

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