Independent Accountants' Investment Counsel Inc.

(source: Bloomberg, MSCI and ARG Inc. analysis)


What happened last week?

  • North American equities were flat on Monday, moved higher and peaked for the week on Tuesday, and then declined for three consecutive days.  The week culminated with losses of 1½ to 3½ percent on both Thursday and Friday.

  • These declines, for the most part, anticipated and preceded major economic releases last week.  On Friday the latest Canadian Labour Force Survey and U.S. consumer inflation data was released.

  • In May, the unemployment rate in Canada fell 0.1% reaching a new record low of 5.1%.  Employment rose by 40,000 when full-time work increased by 135,000 and part-time work fell 96,000.  Wages have risen 3.9% over the past year. (Source)

  • The U.S. Consumer Price Index (CPI) rose 1.0% in May and the annual inflation rate sits at 8.6%.  Again, the sub-indexes for food and energy were major contributors to the overall inflation rate, rising 1.2% and 3.9%, respectively, during May.  The rise of these two categories is significantly higher than the increases experienced in April.  The inflation rate for “all items less food and energy” rose 0.6% in April and again in May, and this flattening was a small measure of positive news. (Source)

  • In stark contrast is China’s CPI of 2.1% for May, which has been heavily influenced by strict Covid-19 controls.  “The modest price pressures also allow China’s central bank to release more stimulus to prop up the economy even as monetary authorities in most other countries scramble to hose down inflation with aggressive interest rate hikes”.  For example, the European Central Bank left its interest rates unchanged last week but intends to raise them by ¼ percent (25 basis points) in July. (Source1, Source2)

What’s ahead for this week?

  • In Canada, April’s construction investment, manufacturing sales and new orders, new vehicle sales and wholesale trade will be announced along with May’s housing starts, home price index and industrial product and raw materials price indexes. 

  • In the U.S., after last week’s CPI announcement the Producer Price Index and the Import and Export Price Indexes for May will be released.  The Federal Reserve’s Open Market Committee meets on Tuesday and Wednesday and will release a monetary policy update and economic projections on June 15th at 2 pm.

  • Globally, inflation numbers will be announced across Europe with major economies like Germany and France reporting as well as the data for the Eurozone.  The Banks of England and Japan will announce interest rate decisions.

For more information contact: [email protected] | Tel (519) 291-2817 | 135 Main Street, East | PO Box 68 | Listowel, ON N4W 3H2


This report is produced by Independent Accountants' Investment Counsel Inc (“IAIC”) in conjunction with ARG Inc.  All graph and chart statistical data contained in this report has been supplied by ARG Inc. The views and opinions expressed in this report are based on market statistics.  No guarantee of outcome is implied, and opinions may change without notice.  Investors should not base any of their investment decisions solely on this report nor should any opinions expressed within this report be construed as a solicitation or offer to buy or sell any securities mentioned herein.  Although the information contained in this report has been obtained from sources that IAIC believes to be reliable, we do not guarantee its accuracy, and as such, the information may be incomplete or condensed. All opinions, estimates and other information included in this report constitute our judgment as of the date hereof and are subject to change without notice.

Please contact your IAIC representative if you have any questions regarding this report. 


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