In the European session, we don’t have anything on the agenda other than a couple of ECB speakers that are going to repeat the same old stuff anyway.
In the American session, the main highlight will be the Canadian CPI report. The CPI Y/Y is expected at 2.3% vs 1.9% prior, while the M/M figure is seen at 0.0% vs -0.1% prior. The underlying inflation measure, the CPI Trimmed Mean Y/Y, is expected at 3.0% vs 3.0% prior (it’s been hovering around 3% since February 2025).
BoC Governor Macklem spoke last week and he delivered a couple of dovish comments that suggested a rate cut in October was coming. The market increased the probabilities from 68% to 86% now. By the end of 2026 the market expects one more rate cut bringing the terminal rate to 2.00%, which would be below the lower bound of the BoC’s estimated neutral range (2.25%-3.25%).
We recently got a strong Canadian employment report, so an upside surprised in the CPI might trigger some hawkish repricing.
Central bank speakers:
- 07:00 GMT/03:00 ET – ECB President Lagarde (neutral – voter)
- 09:30 GMT/05:30 ET – ECB’s Escriva (neutral – voter)
- 13:00 GMT/09:00 ET – Fed’s Waller (dove – voter)
- 19:30 GMT/15:30 ET – Fed’s Waller (dove – voter)
*the FOMC is in blackout period, so don’t expect monetary policy comments
