Current Economics
What's changed since our last daily update on August 7 and this week's market outlook — Bank of Canada policy is unchanged and not repeated below.
Published 2026-08-12 · Educational information only
Markets pushed to fresh records Wednesday after July's U.S. CPI report came in in line with expectations, easing pressure on the Federal Reserve and confirming the dovish repricing flagged in our August 10 outlook. The TSX notched its fourth straight record close, led by financials and materials, while U.S. indexes were mixed to higher.
The S&P/TSX Composite rose 186.22 points (+0.51%) to a fresh record 36,662.14 — its fourth consecutive record-high close — with financials, materials, and technology shares leading gains and Air Canada surging more than 12%.
The S&P 500 rose 0.3% to 7,748.50 and the Nasdaq jumped 0.5% to 26,588.49 on strong AI-sector earnings, while the Dow was roughly flat, easing 21.58 points to 53,770.27.
The U.S. 10-year Treasury yield held near 4.69%, little changed, as today's in-line inflation print left the outlook for a Fed hold at the September 16 meeting broadly intact.
The loonie firmed, with USD/CAD easing to about 1.3944 (roughly CAD/USD 0.717), from around 1.4012–1.4016 at our last update.
Gold climbed to about US$4,399 an ounce (+0.66% on the day), extending its recent surge. WTI crude eased to around US$83 a barrel.
Today's headline event: July's U.S. CPI report showed consumer prices rose 0.1% on the month and 3.4% year over year — down 0.1 point from June and in line with consensus, matching the cooler-than-expected scenario flagged in our August 10 outlook. Core CPI cooled to 2.5% year over year, its slowest pace since March 2021. The in-line, cooling print reinforces expectations that the Fed holds rather than hikes at its September 16 meeting. Canada's July CPI has not yet been released; it is due August 17.
Risk appetite stayed firm globally as easing U.S. inflation and strong technology-sector earnings supported equities; markets now turn to Thursday's U.S. Producer Price Index and UK GDP data, and Friday's U.S. retail sales, for the next read on the economy.
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