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Bank of Canada Keeps Q2 Output Gap, Neutral Rate Unchanged
The Bank of Canada estimates Q2 output gap between -1.5% and -0.5%, unchanged from April. Potential output growth for 2026 revised to 1.1% from 1.2%, while neutral interest rate midpoint remains at 2.25%-3.25%.
Bank of Canada Cuts 2026 Growth Forecast to 0.7%, Raises Near-Term Inflation Outlook
The Bank of Canada has revised its growth and inflation projections, cutting its 2026 GDP forecast to 0.7% from 1.2% while raising 2027 and 2028 estimates. Inflation is expected to average 2.5% in 2026, up from the previous 2.3%.
Fed Rate Hike Odds Plunge to 4% After Record PPI Drop
The probability of a Federal Reserve rate hike in July has fallen to a new low of 4% following the largest monthly decline in US Producer Price Index (PPI) since April 2025. Both headline and core PPI were also revised lower for May.
Fed's Williams: Economy Solid, Absorbing Middle East Risks Well
New York Fed President John Williams stated that U.S. economic growth is solid and on trend, with the labor market similarly stable, and while Middle East conflict poses significant risks, the economy has absorbed them fairly well so far.
Fed's Williams: AI Investment Impact Uncertain; Middle East Risk Persists
Federal Reserve's John Williams said the full economic effects of the AI investment surge on growth, employment, and inflation are hard to predict. He also noted ongoing supply disruptions from the Middle East conflict pose a risk to both growth and inflation outlooks.
Fed's Williams: Inflation to Fall to 3.25% by Year-End, 2% by 2028
New York Fed President John Williams expects overall inflation to decline to around 3.25% by the end of this year, then continue toward the 2% goal, reaching it by 2027 and landing on target in 2028. He also said medium- and longer-term inflation expectations remain well anchored.
China Q2 GDP growth slows to 4.3%, below target range – Standard Chartered
Standard Chartered economists note China's Q2 GDP growth slowed to 4.3% year-on-year, falling below the 4.5–5.0% target range, with domestic demand remaining weak.
June PPI Inflation Falls to 5.5%, Below Expectations
June headline PPI came in at 5.5% versus 6.2% expected, while core PPI dropped to 4.7% (forecast 5.2%). Month-over-month PPI declined 0.3%, the steepest drop since April 2025, further reducing the likelihood of rate hikes.
Eurozone Industrial Production Dips in May
Eurozone industrial production declined slightly in May, continuing a sluggish trend with no clear direction, and recent optimism has yet to translate into stronger output.
IBM Loses $69B in Market Cap, Banks Post Record Profits, CPI Cools
IBM suffered a sharp decline wiping out $69 billion in market value. Meanwhile, banks reported record profits and CPI inflation data came in cooler than expected.
US Launches Strikes on Iran to Degrade Strait of Hormuz Threat
US Central Command began a wave of strikes against Iran to degrade military capabilities used to attack commercial shipping in the Strait of Hormuz.
BoC Rate Decision, Fed Testimony, and UK GDP in Focus This Week
Key FX events this week include the Bank of Canada rate statement, US Core PPI, Fed Chairman Warsh's Senate testimony, and UK GDP data.
Oil Surges 2% as US Reinstates Strait of Hormuz Blockade, Brent Above $86
Oil prices rose 2% on Wednesday as the US naval blockade of the Strait of Hormuz was reinstated, pushing Brent crude above $86 per barrel.
US CPI Softens, Temporarily Easing Rates Pressure – DBS
DBS economists note US Treasuries curve bull steepened after softer June CPI data, with energy and core services surprising to the downside.
Silver Falls to $58.41, Down 0.46% on Wednesday
Silver prices declined on Wednesday, trading at $58.41 per troy ounce, a 0.46% drop from the previous close of $58.68, according to FXStreet data.
China Urges US to End Cuba Blockade, Backs Sovereignty
China's Foreign Ministry called on the U.S. to immediately stop its decades-long blockade and sanctions against Cuba, expressing firm support for Cuba's sovereignty and opposition to external interference.
ECB's Panetta Sees Inflation Above 3% Until 2027, Warns of Risk Underestimation
ECB board member Panetta says eurozone inflation is around 3% and likely to stay above that level through early 2027. He warns that equity market rallies post-Iran conflict reflect underestimation of risks from energy prices, tight financial conditions, and geopolitical uncertainty.
Silver Jumps Nearly 2% as USD Slips on Weak CPI Data
Silver rose nearly 2%, outperforming gold, as a softer US dollar and diminished Fed rate-hike expectations followed weak core CPI data, according to OCBC analysts.
ECB's Nagel Says Act Decisively If Needed
ECB Governing Council member Joachim Nagel said the central bank should be prepared for decisive monetary policy adjustments if required, without specifying direction.
PBoC Deputy Governor Vows Continued Loose Monetary Policy
A People's Bank of China deputy governor reiterated the central bank's commitment to an appropriately loose monetary policy during European trading on Wednesday.
Google DeepMind CEO Proposes US Standards Body to Test AI Models Before Release
Demis Hassabis, CEO of Google DeepMind, has proposed the creation of a US standards authority to evaluate the most powerful AI models before public release, covering cybersecurity, biological threats, and system deception.
ABN AMRO: US CPI surprise shapes Fed rate path
ABN AMRO's Rogier Quaedvlieg analyzes the recent downside surprise in US CPI data and its implications for the Federal Reserve's interest rate trajectory.
CEE House Prices Continue Steady Upward Trend: Eurostat
Residential property prices in Central and Eastern Europe are showing sustained growth, according to the latest Eurostat data released about two weeks ago.
JPMorgan: Oil Risk Shifts North of Hormuz
JPMorgan warns that the most significant oil supply risk is no longer the Strait of Hormuz but a new threat nearly 2,000 miles farther north.