Global financial markets were relatively choppy last week as tensions in the Middle East escalated, lifting oil prices, while markets worried about the valuations of artificial intelligence stocks. There were some major economic announcements, ranging from the Bank of Canada’s (BoC) interest rate decision to China’s second-quarter 2026 economic growth. This week in Canada, attention will turn to inflation and retail sales, which will give some insight into the overall health of Canadian consumers. Here’s what to watch for this week.

• Statistics Canada will announce Canada’s inflation data for June today. Canada’s annual inflation rate accelerated in May in response to higher energy prices. Oil prices came down in June with geopolitical tensions easing.
• Canada’s retail sales in May will be released on Thursday. Retail sales in Canada rose for four consecutive months to April, with early estimates showing another increase in May.
• South of the border, US manufacturing and services sector activity will be released on Friday. In the manufacturing sector, new orders and output continue to expand, but price pressures are weighing on the sector.
• Over in Europe, the European Central Bank (ECB) makes its interest rate announcement on Thursday. The ECB lowered its policy interest rates at its previous meeting, citing elevated inflationary pressures.
• Notable earnings in Canada include Rogers Communications, Teck Resources and Canadian National Railway. Key earnings in the US include IBM, Tesla, Alphabet, Intel and American Express.

There’ll be plenty of economic news for markets to digest as they make investment decisions. Inflation data out of Canada will be closely monitored to get insight into whether inflationary pressures are subsiding and if they remain mostly contained to energy products. The BoC has held interest rates steady with core inflation remaining close to its target. We are a little over a week away from the next interest rate decision of the US Federal Reserve Board.

If you would like to discuss this economic and market update or have questions about your finances and investments, please feel free to contact me anytime.