Core Viewpoint - The upcoming Federal Reserve meeting is under unprecedented pressure due to political tensions, changing trade policies, and conflicting economic signals, with significant data releases on GDP and employment expected to influence policy direction [1] Economic Data Summary - The U.S. GDP annualized growth rate for Q2 is projected to reach 2.4%, a significant improvement from the contraction of 0.5% in Q1, primarily driven by a sharp reduction in the trade deficit [1] - The July non-farm payroll report is anticipated to show a cautious hiring trend among businesses, with new job additions expected to slow down following a surge in the education sector in June, and the unemployment rate may slightly rise to 4.2% [1] - The June personal income and spending report is expected to indicate a slight acceleration in the core inflation metric favored by the Federal Reserve, suggesting that tariffs are gradually being passed on to consumers [1]

Core Insights - Canada's overall CPI decreased to 1.7% in April from 2.3% in March, primarily due to a 12.7% drop in overall energy prices following the removal of the federal consumer carbon tax [1] - However, two of the three core inflation indicators closely monitored by the Bank of Canada reached a 13-month high, indicating potential price pressures [1] - The Bank of Canada had previously forecasted that overall inflation data would drop to around 1.5% due to the removal of the carbon tax and falling crude oil prices [1] Inflation Details - Gasoline prices fell by 18.1% year-over-year in April, while natural gas prices decreased by 14.1% [1] - Consumer spending on grocery items increased by 3.8% compared to the same period last year, up from 3.2% in March [1] - Travel prices rose by 6.7% year-over-year in April [1] - Month-over-month, the inflation rate decreased by 0.1%, slightly better than analysts' predictions of a 0.2% decline [1]