Market News: Week Ending September 18, 2026

Market News: Week Ending September 18, 2026

The U.S. Census Bureau announced that retail and food services sales rose 1.2% (seasonally adjusted) in August following a revised 0.5% decline in July (previously reported as -0.6%). Overall sales were up 6.0% compared to August 2025. Excluding autos, sales were up 1.4% during the month and up 6.9% 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.

The Canada Mortgage and Housing Corporation announced that housing starts fell 0.1% to 229,046 units (seasonally adjusted annual rate) in July. This is down from June’s revised 229,360-unit level (originally reported as 229,074). The CMHC’s six-month trend level (which tends to smooth the results) was 244,149 in this report, down 1.3% from July. 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 continue to reflect poorly on political attempts to improve this issue. With the market looking for an advance, these results are considerably weaker than consensus expectations. Activity in the housing market has a significant "ripple" effect on the broader economy.

Statistics Canada announced that building permits reversed course, falling 17.3% in July. The monthly move follows a revised 18.2% increase in June (originally reported as 18.5%). The July decline was led by a 27.1% weakening in non-residential permits while the residential sector posted an 8.9% drop. Despite the dramatic monthly decline, total overall permits are still up 0.9% on a year-over-year basis. Non-residential permits are up 6.0% but residential permits are down 2.3%, on this basis. Even with the wide swings seen recently, these results are weaker than market expectations. Permits are an indicator of the future level of activity in the construction sector. Canada’s ongoing housing shortage has placed considerable focus on residential permitting.

Following its two-day monetary policy meeting, the U.S. Federal Reserve (Fed) raised interest rates by 25 basis points (a basis point is 1/100th of one per cent), moving the target for the federal funds rate to the range of 3.75% to 4.00%. This is the first rate hike since July 26, 2023. And follows six interest rate cuts, which provided a cumulative reduction of 175 basis points, during the prior easing cycle. This moves administered interest rates to their highest level since December 9, 2025.  Importantly, the Fed statement contained the text “Job gains have kept pace with the workforce, and the unemployment rate has changed little. Inflation remains elevated. Today's policy action will support a timelier return to the Committee's 2 percent goal.” This clearly indicates that the Fed remains more clearly focused on inflation, rather than on unemployment. The annual growth of the consumer price index stood at 3.4% in August. The rate hike was the anticipated outcome, and the market will now begin evaluating the chances of a follow-up move at the next policy meeting, scheduled for October 27 and 28.

Statistics Canada reported that its Industrial Product Price Index (IPPI) rose 1.3% in August while its Raw Materials Price Index (RMPI) rose 3.1% during the month. A 4.0% increase in energy prices at the industry level was the primary driver. Not surprisingly, a 7.1% advance in crude energy product prices was also the largest move up at the raw material price level. On a year-over-year basis, the IPPI is up 13.5% and the RMPI is 22.8% 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. Census Bureau announced that housing starts in August were at a seasonally adjusted annual rate of 1,275,000. his is 2.6% below the revised July estimate of 1,309,000 and is 1.2% below the August 2025 rate of 1,291,000. At the same time, the number of building permits issued in August was 1,394,000. This is 2.7% below the revised July rate of 1,433,000 but is 3.5% above the August 2025 rate of 1,347,000. The starts and permits results are both weaker than market expectations.

The U.S. Department of Labor announced that initial jobless claims totalled 196,000 (seasonally adjusted) in the week ending September 12, a decrease of 10,000 from the previous week's unrevised level of 206,000. The 4-week moving average was 203,250, a decrease of 2,750 from the previous week's unrevised average of 206,000. These results are somewhat stronger than market estimates.

The U.S. Federal Reserve announced that industrial production was unchanged in August, following a 0.2% gain in July. On a year-over-year basis, industrial production was reported to have gained 1.4%. At the same time, capacity utilization for total industry stood at 76.3% in August, unchanged from the level reported for July of this year but up from the 76.1% level seen in August 2025. These results are modestly weaker than market consensus and show limited movement  in the industrial sector.

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.