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What happened last week?
Volatility in markets returned for commodities and equities. Oil jumped on Monday to $104, dropped below $100 and then soared above $103 to end the week. Gold dropped on four of five days and sits near $4000. The narrowly held Dow managed a small gain for the week, while the TSX, S&P 500 and NASDAQ fell ½ to 1% for the week. All the equity indexes in the grid, above, lost ground on Thursday on Friday.
Following the success of the “stay” vote in Alberta, which added some economic and political stability for Canadians, investors returned to economic indicators and their effects on markets.
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After the focus on similar U.S. indicators in the previous week, it was time for Canada’s inflation data to be announced. The Consumer Price Index (CPI) rose 3.1% year-over-year in September following a 3.0% increase in August. Gasoline led the increase in the headline inflation rate, excluding gasoline CPI rose 2.2%. Core CPI which excludes energy and food was slightly higher at 2.4%. StatsCan CPI release
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“Prices of products manufactured in Canada, as measured by the Industrial Product Price Index (IPPI) rose 2.0% in September and gained 14.5% year over year”, according to the latest IPPI release from StatsCan. The Raw Materials Price Index (RMPI) gained 4.8% in September, led by increasing prices for crude energy products. Excluding crude energy products, the RMPI decreased by 0.4% last month.
The New Housing Price Index fell 0.2% in September, the seventh consecutive month of declining prices.
Additionally, retail sales in Canada rose 1.2% in August. Total sales reached $74.6 billion after all nine subsectors and six provinces increased, led by increases at motor vehicle and parts dealers. It was a turnaround from July’s 0.7% decline. StatsCan retail sales
What’s ahead for this week and beyond?
In Canada, wholesale sales and gross domestic product (GDP) will be reported. The Bank of Canada will release an interest rate decision and Monetary Policy Report on Wednesday morning.
In the U.S., building permits, new home sales, house price index, durable goods orders, GDP and the Federal Reserve’s preferred inflation indicator, the Personal Consumption Expenditures Price Index (PCE) will be released. On Wednesday afternoon, the Federal Reserve will release an interest rate decision.
Globally, Japan’s coincident indicator, leading index, household confidence, Consumer Price Index, unemployment, industrial production, retail sales, Bank of Japan interest rate decision, China’s industrial profit, and the Eurozone’s lending, consumer confidence, consumer inflation and selling price expectations, GDP and European Central Bank interest rate decision will be released.
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