Canada Macro Daily(Beta Mode)
CPI Surprise Lifts CAD as Housing Weakens
Market Snapshot
| Asset | Level | Change |
|---|---|---|
| S&P/TSX | 36,365.40 | -0.10% |
| USD/CAD | 1.37 | -0.52% |
| EUR/CAD | 1.61 | -0.29% |
| WTI Crude | 86.40 | -1.63% |
| Natural Gas | 2.78 | +1.87% |
| Gold | 4,656.00 | +3.09% |
| Brent Crude | 93.29 | -0.52% |
| Bitcoin | 76,970.74 | +5.39% |
| Canada 2Y Govt Yield | 2.27% | +1.00% |
| Canada 10Y Govt Yield | 3.42% | -3.43% |
Prior Economic Events
| Data | Prior | Cons | Actual |
|---|---|---|---|
| Inflation Rate Year-over-Year | 2.80 | 2.90 | 3 |
| Core Inflation Rate Year-over-Year | 2.10 | - | 2.30 |
| Inflation Rate Month-over-Month | -0.40 | 0.40 | 0.50 |
| Housing Starts Level | 240,800 | 248,000 | 229,100 |
| New Housing Price Index Month-over-Month | -0.10 | 0 | -0.10 |
Canada Housing Starts | Type: macro_line | Thousands: 1239 (2026-07-01) | Range: 1182–1807 | Trend(6pt): 1576,1434,1378,1346,1182,1239
Today's Economic Events
| Data | Prior | Cons | Time |
|---|---|---|---|
| Retail Sales Month-over-Month Final | 1 | 0.40 | 04:30 |
| Retail Sales Month-over-Month Preliminary | 1 | - | 04:30 |
| Retail Sales excluding Autos Month-over-Month | 1.20 | 0.40 | 04:30 |
| Senior Loan Officer Survey | - | - | 06:30 |
- Canada CPI YoY rose to 3.03% in July, exceeding the 2.9% consensus and lifting core measures.
- Housing starts fell to 229,100 in July, missing expectations and signaling softer residential activity.
- CAD strengthened with USD/CAD declining 0.52% amid fading US rate-hike bets and tariff progress.
Yesterday's Recap
July CPI printed 3.03% year-over-year, above consensus, with the month-over-month rate at 0.5% versus 0.4% expected. Core inflation accelerated to 2.3% from 2.1% previously, driven mainly by shelter costs while goods prices stayed subdued. Housing starts dropped to 229,100, well below the 248,000 forecast, marking the weakest reading in several months.
The S&P/TSX closed 0.10% lower at 36,365.40 as energy and financial shares weighed on the index. USD/CAD fell to 1.37, reflecting CAD gains, while the 10-year Canada yield eased 3.43% to 3.42%. WTI crude declined 1.63% to 86.40 amid softer demand signals, though natural gas rose 1.87%.
Gold advanced 3.09% to 4,656.00 as investors sought safety. New housing prices were unchanged month-over-month at -0.1%, matching the prior reading and consensus.
The Day Ahead
Retail sales month-over-month final and preliminary readings are due at 04:30 ET, with consensus pointing to a 0.4% gain after last month’s 1.0% rise. Excluding autos, sales are also expected to advance 0.4%. The Senior Loan Officer Survey at 06:30 ET will provide fresh insight into credit conditions and lending standards.
Markets will watch for any surprise in consumer spending that could alter BoC easing probabilities. A softer print may reinforce expectations for further policy support later this year, while strength could support the CAD. No Bank of Canada speakers are scheduled.
Other Economic Notes
Bank of Canada research highlighted that AI adoption is creating headwinds for job matching, potentially keeping labor-market slack elevated. Ottawa secured a three-day extension on US tariffs covering $20 billion of goods, keeping bilateral trade tensions contained for now. The tentative metals and autos deal would cut certain Canadian steel and aluminum tariffs to 25%, offering modest relief to exporters.
Natural-gas storage data came in below forecasts, lending support to Henry Hub prices. These developments underscore Canada’s exposure to both US policy shifts and domestic productivity challenges.
