TD/ Canada Trust Economic Highlights – August 24


United States

  • Another turbulent week in global financial markets, as renewed fears of a weakening Chinese economy and uncertainty surrounding the timing of rate liftoff were top of mind for investors. With risk-off sentiment prevailing, U.S. equities ended the week on the back foot, with the S&P 500 down 5.0% at the time of writing.
  • Minutes from the Federal Reserve’s July 28-29 meeting gave no additional indication on the timing of rate liftoff. Markets interpreted the minutes as slightly dovish, cutting the probability of a September rate hike from a near 50% on Monday to 28% as of Friday afternoon.
  • On the data front, both existing homes sales and housing starts surprised to the upside in July, rising to 5.59 million and 1.21 million units, respectively. The July reading of CPI came in a touch lower than expected, with both headline and core rising by 0.1% m/m. On a year-over-year basis, core CPI remained unchanged at 1.8%.


  • Financial market turbulence continued to dominate the headlines this week, as global equity markets pushed lower. The WTI price of oil declined to US$40 per barrel, extending its weekly losing streak to eight – the longest since 1986. The S&P TSX fell 4.9% from last Friday. The Canadian dollar held steady at 76 US cents, as the impact of falling oil prices was tempered by more dovish sentiment coming out of the July U.S. Federal Reserve’s FOMC meeting minutes.
  • Canadian retail sales increased 0.6% (M/M) in June, coming in ahead of market expectations. In real terms, sales were flat. On a quarterly basis, volumes were up 1.6% (annualized) in Q2 – a significant improvement from the 1.5% decline recorded in Q1.
  • The Canadian consumer price index (CPI) rose 1.3% (Y/Y) in July, accelerating slightly from the 1.0% increase in June. The core measure of inflation was up 2.4% relative to last July (June: +2.3%).

For further information, please contact:

John Maveety Manager, Residential Mortgages – Greater Ottawa Area TD Canada Trust
T: (613) 371-1984 F: (888) 899-1984 P: (866) 767-5446