Core Insights - David Rosenberg, head of Rosenberg Research, indicates that there are no factors preventing the Bank of Canada from lowering interest rates again [1] - Several key indicators highlight the weakness of the Canadian economy, including a decline in sales expectations, weak capital expenditure intentions, and high levels of layoff plans [1] - Concerns about inflation risks should be alleviated as corporate wage growth expectations have halved from a peak of 5.8% in May 2022 to 3%, the lowest level in four years [1]

Group 1: U.S. Economic Indicators and Market Reactions - The unexpected lower-than-expected U.S. inflation data for August and ongoing weak employment figures have strengthened market expectations for an imminent interest rate cut by the Federal Reserve [1] - Major U.S. stock indices collectively rose last week, with the Dow Jones increasing by 0.95%, the S&P 500 rising by 1.59%, and the Nasdaq up by 2.03% [1] Group 2: Oil Market Dynamics - International oil prices increased last week due to geopolitical tensions, including Israel's attack on Hamas and Russian drones entering Polish airspace, raising concerns about potential supply risks in the Middle East and Eastern Europe [2] - New York oil prices rose by 1.33%, while Brent crude prices increased by 2.27% [2] Group 3: Gold Market Performance - International gold prices saw a cumulative increase of 0.91% last week, supported by ongoing expectations of a rate cut by the Federal Reserve, with three trading days reaching historical closing highs [3] Group 4: Central Bank Decisions - The upcoming "Super Central Bank Week" will see major central banks, including the Federal Reserve, Bank of England, and Bank of Japan, announce their latest interest rate decisions, with diverging monetary policy directions expected [4][5] - The Federal Reserve is anticipated to announce a 25 basis point rate cut, influenced by signs of a weak labor market and inflation rebound [4] - The Bank of England faces a dilemma between maintaining rates to observe inflation trends or cutting rates to stimulate the economy, with expectations leaning towards keeping rates unchanged [4] - The Bank of Japan is likely to maintain its current interest rate, but there remains a possibility of a rate hike later this year, depending on inflation outlook statements from the central bank [5]

Core Viewpoint - The article discusses the recent trends in the Canadian dollar against the US dollar, highlighting the impact of inflation data on the Canadian central bank's interest rate decisions [1] Group 1: Inflation Data - The overall inflation rate in Canada decreased from 1.9% to 1.7% in July [1] - The inflation rate excluding indirect taxes also fell from 2.5% to 2.2% [1] - Core inflation, which excludes volatile items like food and energy, remains above 3%, indicating persistent inflationary pressures [1] Group 2: Central Bank Predictions - Desjardins Group maintains its prediction for a potential interest rate cut by the Bank of Canada next month, influenced by the "relatively mild" inflation data [1] - Economist Royce Mendes noted that price increases related to tariffs may have begun earlier than the central bank anticipated [1] Group 3: Currency Trends - The USD/CAD exchange rate was reported at 1.3733, with a slight decline of 0.01% from the opening price of 1.3737 [1] - The Bollinger Bands indicate resistance at the upper band of 1.3766 and support at the lower band of 1.3739, with the latest price fluctuating around 1.3760 [1]

Core Viewpoint - The Canadian dollar is under pressure due to weak CPI data, which has increased expectations for further interest rate cuts by the Bank of Canada [1] Economic Data Impact - The USD/CAD exchange rate has rebounded, currently reported at 1.3842, with a gain of 0.11% [1] - Weak Canadian CPI data has significantly impacted the Canadian dollar's performance, reinforcing market expectations for a rate cut [1] - The upcoming second-quarter GDP data will be closely watched, as its performance will coincide with the U.S. PCE core inflation data [1] Interest Rate Expectations - Investors currently estimate a 33% probability of a 25 basis point rate cut by the Bank of Canada at the meeting on September 17 [1] - By December, the likelihood of a rate cut is expected to rise to 90% [1] - A weak performance in the second-quarter GDP data could further solidify the rationale for another rate cut by the Bank of Canada before the end of the year, potentially leading to additional selling pressure on the Canadian dollar [1]

Core Viewpoint - Canadian inflation remains high, delaying interest rate cuts according to Dominique Lapointe from Manulife Investment Management [1] Inflation Analysis - The Bank of Canada is hesitant to overlook temporary price increases caused by retaliatory tariffs due to uncertainty regarding the extent of cost pass-through and other inflationary factors [1] - Despite high inflation, Canada has not yet faced recessionary pressures that would compel the central bank to adopt a more accommodative stance [1] Future Projections - Lapointe anticipates that rising unemployment, an expanding output gap, and the clearer temporary impact of tariffs on inflation will ultimately lead the central bank to implement two more interest rate cuts during the current cycle [1]

Core Viewpoint - The door for a rate cut by the Bank of Canada in July has been completely closed due to persistent cost pressures in the economy, as indicated by the June inflation report [1] Economic Indicators - The three-month annualized growth rate of the core consumer price index in June reached 3.5%, marking a six-month high [1] - The cost pressures are attributed to a weaker Canadian dollar and retaliatory tariffs on U.S. imports [1]

Core Viewpoint - The Bank of Montreal's chief economist Doug Porter asserts that there is no justification for the Bank of Canada to lower interest rates in July due to persistent core inflation despite economic growth being below potential [1] Economic Indicators - The core Consumer Price Index (CPI) in Canada remained at 3% in June, which is at the upper limit of the Bank of Canada's inflation target range [1] - The increase in housing costs is contributing to upward pressure on core inflation [1] Price Changes - The retaliatory tariffs on U.S. imports are partially responsible for the high core inflation [1] - In June, the price of durable goods accelerated to a 2.7% increase from 2% in May [1] - The automotive prices rose by 4.1%, furniture prices increased by 3.3%, and clothing and footwear prices went up by 2% [1]

Core Viewpoint - The upcoming Canadian CPI report will be crucial in determining the likelihood of a rate cut by the Bank of Canada later this month [1] Economic Indicators - The Canadian job market showed strong performance with a net increase of 83,100 jobs [1] - The overall unemployment rate decreased from 7% to 6.9% [1] - The unemployment rate for the prime working age group (25 to 54 years) fell more significantly from 6% to 5.8% [1] Central Bank Considerations - Despite the decrease in unemployment rates, they remain high and are not considered a "swing factor" for the Bank of Canada's policy decisions [1] - The focus will be on the inflation data to be released on Tuesday [1]

Core Viewpoint - The Canadian dollar has appreciated by 3.5% against the US dollar in the second quarter, driven by rising oil prices and negative sentiment towards the US dollar, despite domestic economic challenges [1] Group 1: Economic Indicators - Domestic demand in Canada is weak, and the unemployment rate is rising, which casts a shadow over the outlook for the Canadian dollar [1] - The Canadian bank anticipates that the Bank of Canada will lower interest rates in July, contrary to current expectations, which may weaken the Canadian dollar [1] Group 2: Political and Market Dynamics - The recent throne speech in Ottawa marks a departure from the practices of the Trudeau era, making Canada more attractive for private capital [1] - The Canadian bank projects that the USD/CAD exchange rate will peak at 1.38 before trending towards 1.34 [1]