Market News: Week Ending June 19, 2026

Market News: Week Ending June 19, 2026

The Canada Mortgage and Housing Corporation announced that housing starts dropped 6.1% to 261,377 units (seasonally adjusted annual rate) in May. This is down from April’s downwardly revised 278,380-unit level (originally reported as 279,317). The CMHC’s six-month trend level (which tends to smooth the results) was 258,010 in this report, up 0.5% from April. Despite considerable political rhetoric over the intervening 5 years, this measure remains well below the June 2021 level of 285,200. Given the dramatic shortfall in housing availability, these statistics are taking on greater importance. With the market looking for a smaller decline, these results are weaker than consensus expectations. Activity in the housing market has a significant "ripple" effect on the broader economy. 

The U.S. Federal Reserve announced that industrial production rose 0.1% in May, following a revised 0.9% gain in April (previously reported as 0.7%). On a year-over-year basis, industrial production was reported to have gained 1.7%. At the same time, capacity utilization for total industry stood at 76.2% in May, up from the 76.1% level reported for April of this year and the 75.9% level seen in May 2025. With the revisions, these results are stronger than market consensus and show a continued rebound across the industrial sector. 

The U.S. Census Bureau announced that housing starts in May were at a seasonally adjusted annual rate of 1,177,000. This is 15.4% below the revised April estimate of 1,392,000 and is 8.7% below the May 2025 rate of 1,289,000. At the same time, the number of building permits issued in May was 1,413,000. This is 0.7% below the revised April rate of 1,423,000 and is 0.2% below the May 2025 rate of 1,416,000. These results are considerably weaker than market expectations. 

The U.S. Census Bureau announced that retail and food services sales rose 0.9% (seasonally adjusted) in May following a revised 0.4% gain in April (previously reported as 0.5%). Overall sales were up 6.9% compared to May 2025. Excluding autos, sales were up 0.8% during the month and up 7.5% on a year-over-year basis. This report was stronger than consensus expectations. Since consumer spending accounts for roughly two-thirds of U.S. economic activity, it is critical to overall GDP results. 

Statistics Canada announced that its New Housing Price Index (NHPI) fell 0.3% in May, following a 0.4% drop in April. In line with the growing softening, on a year-over-year basis, the index is now down 2.4%, the weakest figure reported since the global financial crisis (-2.7% y/y in September 2009). Price weakness for new housing continues to contrast sharply with the apparent, broader demand for housing. These results are weaker than consensus expectations. 

Following its two-day monetary policy meeting, the U.S. Federal Reserve (Fed) held interest rates steady, leaving the target for the federal funds rate in the rage of 3.50% to 3.75%. This is the fourth “on hold” result following six interest rate cuts during the current easing cycle. This is the first policy meeting chaired by Kevin Warsh, who took over the job of governor from Jerome Powell. Administered interest rates remain at their lowest level since November 1, 2022, following a total reduction of 175 basis points (a basis point is 1/100th of one per cent). Importantly, the Fed statement contained the text “Inflation remains elevated relative to the Committee's 2 percent goal, in part reflecting supply shocks that have driven price increases in certain sectors, including energy.” This indicates that the Fed remains more clearly focused on inflation, rather than on unemployment. The annual growth of the consumer price index stood at 4.2% in May. The “no move” result was the anticipated outcome, and the market will now begin evaluating the most likely scenario for the next policy meeting, scheduled for July 28 and 29. 

Market Focus Statistics Canada reported that its Industrial Product Price Index (IPPI) jumped 1.2% in May while its Raw Materials Price Index (RMPI) climbed 0.7% during the month. A 7.0% advance in chemicals and chemical products prices at the industry level was the primary driver. Alternatively, at the raw material price level, a 2.2% gain in crop product prices was the largest advance. On a year-over-year basis, the IPPI is up 13.6% and the RMPI is 33.4% higher. The IPPI and RMPI data are closely watched as they indicate relative inflationary pressures at the industry and raw materials levels and will apply those pressures to consumer prices. 

The U.S. Department of Labor announced that initial jobless claims totalled 226,000 (seasonally adjusted) in the week ending June 13, a decrease of 4,000 from the previous week's revised level. The previous week's level was revised up by 1,000 from 229,000 to 230,000. The 4-week moving average was 223,250, an increase of 4,000 from the previous week's revised average. The previous week's average was revised up by 250 from 219,000 to 219,250. These results match market estimates. 

Statistics Canada reported that retail sales rose 0.5% (seasonally adjusted) in April, following a 0.9% in March. April sales were stronger in five of nine main subsectors, with Gasoline (+5.1%) reporting the largest advance. Food & Beverage (-2.0%) reported the largest monthly decline. On a year over year basis, overall sales were up 3.7%. The monthly advance was smaller than the 0.6% gain that was estimated for April by the data agency in the prior report. The advance estimate for May is for a 1.0% increase in sales. Since consumer spending accounts for over 60% of Canadian economic activity, it is critical for overall GDP results.

Note:
All index performance is in Canadian dollars.

IMPORTANT DISCLAIMERS
The information in this letter is derived from various sources, including CI Global Asset Management, CRA, Bloomberg, National Post, Globe and Mail, Wall Street Journal, Bloomberg, Reuters, Investment Executive, Advisor.ca, MarketWatch, Toronto Sun, The Guardian, MSN.ca and Statistics Canada at various dates. This material is provided for general information and is subject to change without notice. Before acting on any of the above, please contact me for individual financial advice based on your personal circumstances. Certain statements contained in this communication are based in whole or in part on information provided by third parties and CI Global Asset Management has taken reasonable steps to ensure their accuracy. Market conditions may change which may impact the information contained in this document.