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BMO on The Day, Week Ahead in Canada

BY MT Newswires | ECONOMIC | 08/18/25 07:30 AM EDT

07:30 AM EDT, 08/18/2025 (MT Newswires) -- Canadian housing data continues to roll out on Monday with July housing starts at 8:15 a.m. ET, which is expected to step back from June but remain at an elevated level, said Bank of Montreal (BMO).

In separate releases, household credit figures and international securities transactions for June will be published at 8:30 a.m. ET on Tuesday, noted the bank.

The leader of the Conservative Party, Pierre Poilievre, gets a second chance to win a seat with Monday's by-election in the Alberta riding of Battle River-Crowfoot, pointed out BMO. The previous Conservative candidate won the riding with over 80% of the vote in the parliamentary election held earlier this year, so it's considered a safe seat for the would-be Leader of the Opposition.

Looking further ahead, the highlight of the week will be Tuesday's consumer price index report for July. The bank expects the headline CPI to rise 0.3% month over month, pulling the yearly rate down to 1.7%. Core inflation looks to come in about +0.2%, keeping those yearly rates around 3%.

Ultimately, the Bank of Canada will need to see two or three months of decelerating inflation before it can put further rate cuts on the table, stated BMO.

Later in the week, retail sales on Friday are expected to retrace part of May's decline with a 1.0% month-over-month gain in June, added the bank. That's weaker than Statistics Canada's 1.6% flash estimate, as softness in gasoline prices and auto sales will weigh. The bank will also be watching the July flash estimate to see how much of the June recovery carried into the start of Q3, given ongoing slack in the labor market.

Also out this week: June construction investment on Tuesday, July new home prices on Wednesday and producer prices on Thursday, and the BoC's Senior Loan Officer Survey for Q2 on Friday.

The Canadian dollar (CAD or loonie) is a touch firmer early Monday at around $1.379 (72.5 cents US), according to BMO.

MT Newswires does not provide investment advice. Unauthorized reproduction is strictly prohibited.

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