Price Pressures Still Building
|U.S. Review
Price Pressures Still Building
- In the midst of tighter labor markets and backlogged supply chains, inflation continued its upward climb in June. Tariff implementation adds upside risk to inflation.
- Producer prices for final demand rose 0.3 percent last month, pushing the year-over-year rate up to 3.4 percent. Similarly, the CPI came in at 2.9 percent on a year-over-year basis in June, marking the strongest pace in over six years.
- After what was otherwise a strong week for inflation data, import prices declined 0.4 percent in June.
Global Review
The BoC Tightens Amid Escalating Trade Tensions
- In a week dominated by trade war headlines, the Bank of Canada (BoC) elected to hike its main policy rate 25 basis points for the fourth time in the past year
- In the United Kingdom, data from the production side of the economy broadly signaled a rebound in economic growth in Q2, which should allow the Bank of England (BoE) to raise its main policy rate at its August meeting.
- The big news this week was the United States’ decision to initiate a process that could lead to another $200 billion in tariffs on imports from China.
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