Market News: Week Ending July 17, 2026

Market News: Week Ending July 17, 2026

The U.S. Bureau of Labor Statistics reported that the consumer price index moved 0.4% lower (seasonally adjusted basis) in June. This is the largest 1-month decrease since April 2020 (-0.8%). Over the last 12 months, the overall index has increased 3.5%, down from the 4.2% figure posted for May, which was the highest since April 2023 (4.9%). The current data revealed that the energy sub-index was the primary driver, falling 5.7% on the month but still standing with a 15.7% advance on a 12-month basis. Further, core inflation (CPI ex food and energy) eased to 2.6% (y/y) for June, below the 2.9% figure seen in both the May and April report. These figures are below market expectations as the energy price drop was larger than anticipated. Market participants will remain focused on any developments in energy pricing and the broader inflation implications heading into the Fed’s next two-day policy meeting, scheduled for July 28 and 29. 

The U.S. Bureau of Labor Statistics reported that its Producer Price Index – Final Demand (PPI-FD) fell 0.3% (seasonally adjusted) in June, following a revised 0.6% increase in May (originally reported as 1.1%). The index rose 5.5% for the 12 months ended June 2026, down from the 6.2% now posted for May, which was the fastest pace since November 2022 (7.4%). As seen in the previous CPI report, softening in energy products (-6.4% m/m) was the primary driver of PPI-FD in June. Coupled with the downward revisions, these results are somewhat lower than market expectations. Market participants remain highly focused on price pressures in the U.S. economy and the likelihood that the energy volatility will continue to influence broader inflationary pressures. 

The Bank of Canada announced that it was holding administered interest rates steady once more at the conclusion of its latest monetary policy meeting. The announcement leaves the target range for overnight borrowing at 2.25% to 2.50% with the official, benchmark Bank Rate at 2.50%. The Bank also maintained the official Deposit Rate at 2.20%. This is the sixth consecutive “on hold” announcement and leaves administered interest rates at their lowest level since July 12, 2022. Rate cuts between June 2024 and October 2025 resulted in a total reduction of 275 basis points (a basis point is 1/100th of one per cent). The Bank statement highlighted the continued weakness in the job market as the unemployment rate “has hovered in a range of 6½% - 7% since the end of 2024.” Further, the Bank lowered its GDP forecast for 2026 to 1.4% from the 1.8% estimate posted in April.  Considerable uncertainty remains, fueled by both the conflict in the Middle East and broader changes in international trading patterns. The market will likely remain cautious in setting its expectations for the next policy announcement scheduled for September 2, 2026. 

The Canada Mortgage and Housing Corporation announced that housing starts dropped 5.6% to 238,971 units (seasonally adjusted annual rate) in June. This is down from May’s downwardly revised 253,083-unit level (originally reported as 261,377). The CMHC’s six-month trend level (which tends to smooth the results) was 248,123 in this report, down 2.8% from May. 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 much smaller decline, these results are considerably weaker than consensus expectations. Activity in the housing market has a significant "ripple" effect on the broader economy. 

The U.S. Census Bureau announced that retail and food services sales rose 0.2% (seasonally adjusted) in June following a revised 1.0% gain in May (previously reported as 0.9%). Overall sales were up 6.7% compared to June 2025. Excluding autos, sales were down 0.2% during the month and up 6.9% on a year-over-year basis. This report was in line with consensus expectations. Since consumer spending accounts for roughly two-thirds of U.S. economic activity, it is critical to overall GDP results. 

The U.S. Department of Labor announced that initial jobless claims totalled 208,000 (seasonally adjusted) in the week ending July 11, a decrease of 8,000 from the previous week's revised level. The previous week's level was revised up by 1,000 from 215,000 to 216,000. The 4-week moving average was 214,250, a decrease of 4,750 from the previous week's revised average. The previous week's average was revised up by 250 from 218,750 to 219,000. These results were stronger than market estimates. 

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.