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It’s a relatively quiet week for Canadian data releases with attention focused on February’s manufacturing and wholesale trade reports on Wednesday.

Advance estimates from Statistics Canada pointed to rebounds in both wholesale sales (excluding petroleum and agricultural products) up 2.3%, while manufacturing sales jumped 3.8% in February, supported by higher sales in the transportation subsector and manufactured food products.

Both releases are consistent with earlier reports that disruptions to auto production late last year and early 2026 were temporary. Earlier disruptions were tied to semiconductor shortages at some plants, and the latest disruptions in January due to longer-than-usual winter retooling to produce new models at some plants.

The anticipated rebound in manufacturing and wholesales points to firmer goods sector momentum heading into February, following a softer start to the year. Together with earlier data, these releases reinforce the view that underlying economic activity is gradually improving after a modest gain in January.

Housing’s slow start to the spring

On the services side of the economy, home resales remains under pressure with mixed early market reports for March following four straight declines in resales nationally since October 2025.

Early reports showed higher sales in some markets (including Toronto), but declines continued in Vancouver. Home prices also continued to edge lower in British Columbia, Alberta, and Ontario, but rose in Quebec, parts of the Prairies, and Atlantic Canada.

Overall, real gross domestic product edged up by 0.1% in January with early estimates pointing to continued expansion in February, supporting a pickup in growth through Q1.

On balance, current data are tracking broadly in line with our base case forecast for moderate Q1 growth with momentum building, despite ongoing sector-specific volatility.

Monday, Apr 13, 2026

Tuesday, Apr 14, 2026

Wednesday, Apr 15, 2026

Thursday, Apr 16, 2026

Friday, Apr 17, 2026

Risk markets recovered and markets repriced central bank action this week, after President Trump announced a two-week ceasefire in the Middle East. Attacks initially continued after the announcement but paused in the early hours of Thursday, except for Lebanon, where Israel continues its forceful military incursion. Despite the temporary and fragile ceasefire, the Strait of Hormuz (SOH) remains effectively closed, and the warring parties disagree publicly on some key ceasefire conditions, particularly those related to Lebanon and the control of the Strait of Hormuz.

Talks to agree on a more permanent ceasefire will begin today in Pakistan, with US Vice President JD Vance leading the US delegation, and Iran represented by high-level political figures, parliament speaker Mohammad Ghalibaf and foreign minister Abbas Araghchi. We still think it is going to be difficult to find common ground on the most controversial issues. Iran still insists on its right to enrich uranium, which the US says they cannot accept. A new major point of disagreement is Iran's demand to maintain control of and charge tolls on the Strait of Hormuz. As we write in our Geopolitical Radar - Pause, Not Peace, 10 April, a ceasefire deal that leaves the Islamic regime in charge of the strait is nothing but prelude to a new war in the future.

Oil prices fell significantly this week with Brent initially trading around USD 90 per barrel after the ceasefire announcement. Since, the price has moved in the USD 90-100 range, as Israeli operations in Lebanon have continued despite Iran and mediator Pakistan, saying the ceasefire was agreed to also apply to Lebanon. Regardless of whether a more permanent ceasefire can be agreed upon, energy prices will remain elevated for longer. The IEA estimates more than 40 crucial energy assets in the region have been damaged. Repairs and ramping up production will be costly and take time. In addition, if Iran is left in control of the strait, a significant geopolitical risk premium will remain.

As energy prices fell, markets also repriced central bank action. For the ECB, markets now price in the first rate hike by June, followed by another one later this year. For the Fed, markets now see a slightly higher chance of a rate cut next year. We have not made any changes to our ECB or Fed calls, but we have revised our Bank of England call and now expect them to keep the Bank Rate unchanged at 3.75% for the coming 12 months. As energy and rate markets adjusted, euro reversed most of its war-time losses vs. the dollar and is currently trading close to the 1.17 level.

Next week will be rather light in terms of data. On Tuesday, China will release trade data for March, which will likely again show robust export growth. One caveat, though, is that the data is very volatile from month to month, so we are likely to see some correction from the extraordinarily high figures in February. The data will also not cover the full impact of the Iran war. On Thursday, China will release both Q1 GDP as well as the monthly batch of data for retail sales, housing, industrial production and investments. Especially housing and consumer data is in focus as these have been the weak spots of the economy. GDP growth is expected at 4.8% y/y, up from 4.5% y/y in Q4, driven by strong export growth. On Thursday, we also get the February GDP print from the UK. Euro area March final HICP print and ECB minutes are also due on Thursday.

Full report in PDF. 

Gold has maintained a nice uptrend since the 23 March crash. However, the price spends a lot of time near the lower boundary of the channel and quickly rebounds from its upper boundary. The price is currently near the lower boundary at around $4,750, whilst the upper boundary stands at $5,000, a level we were expecting to see a week earlier.

From a technical analysis perspective, bulls are undoubtedly encouraged by the strong rebound following the 200-day moving average, which was touched at the end of March, after which the upward trend was established. Furthermore, the downward-sloping 50-day moving average is gradually lowering the threshold that buyers must clear to confirm a bullish trend.

However, a weakness lurks in the latter point. A fall of more than 20% from the peak signals the start of a bear market, whilst the latest rebound merely indicates that not everyone has accepted this fact, buying at the bottom. We last saw the same sharp decline following a similar rally that touched the 200-day moving average, followed by a powerful rebound, back in 2011. Gold then rose even above the 50-day moving average, recouping three-quarters of the downward momentum, but left its highs untouched for the following nine years. Adjusting past movements to current figures, we see the potential for a rebound to around $5,200, where gold traded in the first days of March.

Even these latest levels may prove out of reach for the bulls, and the price rise may well stall as it approaches $5,000, as the deteriorating macroeconomic outlook, inflation prospects (and central banks’ responses to them) are sharply fuelling selling interest among both retail investors and large fund managers.

Gold was too quick to believe in an end to the Middle East conflict and a cut in Fed rates. If the negotiations fail, a situation like the late 1970s will arise, when the oil crisis sent US consumer prices soaring. In response, the Fed raised rates to 20%, and gold prices plummeted by 85% between 1980 and 1999.

Markets

US headline CPI accelerated to 0.9% M/M in March, the fastest monthly pace since June 2022. On an annual basis, inflation increased from 2.4% to 3.3%, in line with our KBC Nowcast estimate but just below the 3.4% consensus estimate. It was the highest outcome since May 2024. Gasoline accounted for almost three-quarters of the US CPI rise in the biggest price rise on record since 1967. Energy prices overall increased by 10.9% M/M, the most since 2005. Other details showed used-car prices falling for a fourth straight month with grocery prices also falling. Services costs excluding energy rose by 0.2% M/M with airfares up 2.7%. Shelter prices rose 0.3% M/M. The pace of core CPI steadied at 0.2% M/M with annual underlying inflation ticking up from 2.5% to 2.6%. Looking forward to April, our KBC Nowcast model expect headline CPI to rise further to 3.8% Y/Y (+0.6% M/M) assuming gas prices slightly above current levels ($4.15/gallon). Core CPI is forecast to stick at 2.6%. US Treasuries very briefly spiked higher as inflation headlines hit the screens, but that move didn’t stick. If any, Treasuries tend to cede some ground going into this weekend negotiations between the US and Iran in Islamabad. With Iran’s 10-point proposal and the US 15-point plan being diametrically opposed, the best outcome probably is to meet again somewhere in the near future and extend the fragile cease-fire. Israel’s role against Lebanon might be crucial in determining the potential success. In the meantime, Iran keeps a very strong grip on the Straight of Hormuz both via its selective toll-booth system and via a loss of confidence at stranded vessels to embark on the passage. US yields currently add around 2 bps across the curve. German Bunds and especially UK gilts underperform. German yields are 4 to 5 bps higher on the day while the UK yield curve bear steepens with yields 5.5 bps (2-yr) to 9 bps (30-yr) higher. Brent crude initially traded with an upward bias today ($96/b to $98/b) after Iran news agencies denied news that a negotiating team had already arrived in Pakistan. They emphasized that negotiations will be suspended as long as the US does not fulfill its commitment to a ceasefire in Lebanon. There were also headline of Iran-backed militia hitting targets in Kuwait. Brent crude afterwards returned to $96/b after Ukrainian President Zelensky’s top aide suggested nearing a deal with Russia to stop the war. On FX markets, the dollar is slightly weaker at EUR/USD 1.1726. European stock markets add 0.75% to their recovery with key US indices currently mixed (-0.3% for Dow, +0.5% for Nasdaq).

News & Views

Hungary heads to the polls on Sunday in what may prove its most consequential parliamentary election in two decades. Prime Minister Viktor Orbán and his Fidesz party are seeking to extend a 16-year hold on power. Over that period, Orbán has steadily consolidated authority, often at the expense of rule-of-law standards and EU norms, according to the European Commission, leaving Budapest frequently at odds with Brussels. The standoff resulted in roughly €20bn of EU funds remaining frozen. Recent polling, however points to a potentially dramatic shift: Péter Magyar, a former Fidesz insider who broke away in 2024 to found the Tisza movement, has surged in popularity. In some surveys he commands a lead large enough to secure a two-thirds parliamentary majority. Markets have responded favourably to the prospect of a more pro-European government, anticipating improved relations with Brussels, access to suspended funds and a return to more orthodox policymaking, developments already reflected in lower long-term yields and a firmer forint. Yet uncertainty remains elevated. Polls are divided and often politically skewed, electoral reforms over the past decade may tilt the playing field towards the incumbent and turnout will be critical—leaving investors wary of asymmetric risks, particularly for the Hungarian currency, despite the prevailing market optimism. At the EUR/HUF 377, the forint almost fully reversed initial losses post the war in the Middle East. Aat 6.45%, the forint 10-y swap yield also already trades about 1.0% below the mid-March peak (Risk-off) levels.

Statistics Canada reported March labour market data close to expectations. Employment rose modestly (+14k), but this came on the back of a 109k cumulative decline over the previous two months. Employment was still 87k higher Y/Y, due to a rise at the end of last year. The unemployment rate was unchanged at 6.7%. Positive job growth was reported in 'other services' (+15k) and also in natural resources (+10k) but employment declined in finance, insurance, real estate, rental, and leasing (-11k). Average hourly wages increased 4.7% Y/Y (was 3.9% Y/Y in February). After broad-based USD strength in the month of March, the loonie recently regained ground to currently trade near 1.382 (peak 1.396 end March).

The University of Michigan Consumer survey showed a sharp surge in inflation expectations in April, with one-year expectations jumping from 3.8% to 4.8%, the largest monthly increase since April 2025. Long-run expectations also rose from 3.2% to 3.4%, marking the highest level since November 2025 and signaling that inflation concerns are becoming more persistent.

At the same time, overall sentiment deteriorated notably. The headline index fell from 53.3 to 47.6, with Current Conditions dropping from 55.8 to 50.1 and Expectations declining from 51.7 to 46.1, pointing to a broad-based weakening in consumer confidence.

Survey Director Joanne Hsu noted that many respondents blamed the Iran conflict for worsening economic conditions, particularly through higher energy prices. However, with most interviews conducted before the April 7 ceasefire announcement, sentiment could improve if supply disruptions ease and gasoline prices moderate.

Full UoM consumer survey release here.

Daily Pivots: (S1) 185.15; (P) 185.71; (R1) 186.54; More...

EUR/JPY's rally accelerates higher today and intraday bias remains on the upside for 186.86 high. Firm break there will resume larger up trend. Next near term target is 161.8% projection of 180.78 to 184.75 from 182.56 at 188.98. On the downside, below 185.88 minor support will delay the bullish case and turn intraday bias neutral first.

In the bigger picture, consolidations from 186.86 might still extend. But as long as 55 W EMA (now at 176.56) holds, the larger up trend from 114.42 (2020 low) remains intact. Firm break of 186.86 will pave the way to 78.6% projection of 124.37 (2022 low) to 175.41 (2025 high) from 154.77 at 194.88 next.

Daily Pivots: (S1) 212.69; (P) 213.27; (R1) 214.22; More...

GBP/JPY's rally from 209.58 accelerate higher today and intraday bias stays on the upside for 214.98 high. Firm break there will confirm larger up trend resumption. Next target is 61.8% projection of 199.04 to 214.98 from 209.58 at 219.43. On the downside, below 213.47 minor support will delay the bullish case, and turn intraday bias neutral again first.

In the bigger picture, up trend from 123.94 (2020 low) is still in progress. Firm break of 214.98 will target 61.8% projection of 148.93 (2022 low) to 208.09 (2024 high) from 184.35 at 220.90. This will remain the favored case as long as 55 W EMA (now at 204.08) holds, even in case of another deep pullback.

Daily Pivots: (S1) 158.54; (P) 158.92; (R1) 159.38; More...

Intraday bias in USD/JPY remains neutral as consolidation from 160.45 is still in progress. Further rise is expected as long as 157.49 cluster support (38.2% retracement of 152.25 to 160.45 at 157.31) holds. Firm break of 160.45 will resume the rise from 152.25 to retest 161.94 high. However, firm break of 157.31/49 will bring deeper fall back to 61.8% retracement at 155.38 next.

In the bigger picture, outlook is unchanged that corrective pattern from 161.94 (2024 high) should have completed with three waves at 139.87. Larger up trend from 102.58 (2021 low) could be ready to resume through 161.94. This will remain the favored case as long as 55 W EMA (now at 152.97) holds. Firm break of 161.94 will pave the way to 61.8% projection of 102.58 to 161.94 from 139.87 at 176.75.