On Friday, US President Donald Trump said he was halting trade talks with Canada in response to Canada imposing the digital services tax. Canada could be facing more tariffs from the US, raising more uncertainty around the outlook for Canada’s economy. Economic announcements will come under the spotlight to see how tariffs are impacting economic conditions. This week, there will be few Canadian economic announcements, but some critical ones. Globally, there will be several economic announcements that might impact the direction of financial markets over the week. Geopolitical and trade tensions persist, which are having an impact on global financial and commodity markets. Here’s what to watch for this week. 

• S&P Global will announce Canada’s manufacturing sector activity for June on Wednesday. Canada’s manufacturing sector has contracted for four straight months, hindered by slower demand from the US amid trade tensions.
• Manufacturing sales are dropping, while the decline in manufacturing activity was a major contributor to Canada’s economic decline in April.
• The US labour market will garner some of the spotlight this week. Private business payrolls and job openings will be released earlier in the week. The unemployment rate and nonfarm payrolls will be announced on Thursday.
• Looking elsewhere, China’s manufacturing sector activity will be announced tonight, European inflation on Tuesday, Japan’s business activity on Wednesday and European services sector activity on Thursday.

It will be a short trading week in Canada and the US, with Canada Day on Tuesday and Independence Day on Friday. Stock and bond markets will be closed on those days. Despite some volatility, Canada’s main index, the S&P/TSX Composite Index, finished higher over the first half of 2025, as of June 27. As we enter the second half of 2025, economic uncertainty in response to tariffs persists. As of Friday, Canada is under the threat of even more tariffs.

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.