Inflation Watch—Canada's Consumer Prices to Tick Higher in June after May's Downside Surprise.We expect it is likely too early to see a significant increase in prices due to tariffs in Canadian and U.S. inflation data for June on Tuesday.

In New York, the Dow Jones Index decreased 287 points or 0.64 percent on Friday. Losses were driven by Nike (-2.61%), Visa (-2.26%) and Salesforce (-1.97%). Biggest rises came from UnitedHealth (1.46%), Amazon (1.26%) and Chevron (0.78%).

Natural Gas Price Forecast: Faces Downward Pressure After Rejection at 200-Day MA.With resistance holding at the 200-Day MA, natural gas remains vulnerable to further downside, potentially targeting the $2.76–$2.80 zone before stabilizing. But higher targets may also apply.

Brent crude oil futures jumped by 2.5% to settle at $70.40 per barrel on Friday, rebounding from a 2.2% drop in the previous session and logging a 1.6% weekly gain, as traders weighed near-term supply tightness against longer-term surplus concerns. Despite the IEA forecasting a potential surplus later this year, strong summer travel demand and high refinery runs are supporting current prices. Russia’s pledge to offset overproduction and expectations of record Saudi crude shipments to China in August added to short-term bullish sentiment. However, the IEA’s upward revision to supply growth and lowered demand projections point to a softer balance later in the year. Longer-term demand uncertainty was echoed by OPEC, which cut its global oil demand outlook for 2026–2029 due to slower Chinese growth. Meanwhile, geopolitical risks remain in focus, with markets bracing for potential new US sanctions on Russia amid growing tensions over Ukraine.

WTI crude oil futures rose 2.8% to settle at $68.40 per barrel on Friday, rebounding from a 2.5% drop in the previous session and logging a 0.6% weekly gain, as traders weighed near-term supply tightness against longer-term surplus concerns. Despite the IEA forecasting a potential surplus later this year, strong summer travel demand and high refinery runs are supporting current prices. Russia’s pledge to offset overproduction and expectations of record Saudi crude shipments to China in August added to short-term bullish sentiment. However, the IEA’s upward revision to supply growth and lowered demand projections point to a softer balance later in the year. Longer-term demand uncertainty was echoed by OPEC, which cut its global oil demand outlook for 2026–2029 due to slower Chinese growth. Meanwhile, geopolitical risks remain in focus, with markets bracing for potential new US sanctions on Russia amid growing tensions over Ukraine.

The S&P/TSX Composite slipped 0.2% to close at 27,023 on Friday, reversing from record highs after President Trump’s surprise decree of a 35% tariff on all non-USMCA Canadian imports unsettled both financials and export-reliant sectors. Canada’s financial giants RBC, Brookfield, BMO and Scotiabank, led the sell-off with losses of 0.6% to 1.1%, while export-sensitive rail giants Canadian Pacific and Canadian National tumbled 0.9% and 0.7%, respectively as investors braced for choked cross-border flows. Domestic resilience—underscored by June’s robust labour report, which added 83,100 jobs and drove unemployment down to 6.9%, and a 12% leap in May building permits to C$13.1 billion—dented expectations for a July 30th Bank of Canada rate cut. The TSX posted modest weekly declines.

US equities closed lower on Friday after President Trump announced a 35% tariff on Canadian imports and warned of broader global tariff hikes. The S&P 500 slipped 0.3% after hitting a record high the previous day, ending a strong streak driven by investor optimism. Trump's letter to Canada raised concerns and warned of further action if retaliation followed, while he also hinted at similar measures targeting the EU is expected shortly. Most sectors were in the red, with health and financials leading the losses, while energy and consumer discretionary were higher. Megacaps were mixed, with Apple (-0.6%), Meta (-1.3%), Broadcom (-0.4%) trading lower, while Microsoft (+0.4%), Tesla (+0.1%), Nvidia (+1%), Alphabet (+1.4%) and Amazon (+1.2%) were higher. For the week, the S&P 500 and the Dow slipped 1.1%, while Nasdaq 100 added 0.1%. Next week, investors will face a busy agenda as the second-quarter earnings season kicks off alongside the release of key inflation reports.

Paraguay’s trade deficit widened to USD 697.9 million through June 2025, reversing a USD 469 million surplus in the same period last year. Registered exports fell 7.7% year-on-year to USD 5.4657 billion, driven by a 24.3% drop in primary products—soybeans plunged 30.4%—partly offset by gains in maize (+45.5%), wheat (+67.8%) and rice (+116.6%). Agro-industrial goods rose 9.0% on robust beef and offal shipments, while industrial manufactures increased 2.4%, led by cables and aluminum. Energy exports declined 8.9%. Meanwhile, registered imports grew 7.3% to USD 8.2887 billion, fueled by higher purchases of industrial manufactures (+11.0%), agro-industrial goods (+14.2%) and primary products (+18.1%). Fuel and lubricant imports fell 18.3%, reflecting weaker diesel and gasoline demand. The shift reflects both softer external sales and firmer domestic demand.

Canola futures fell toward CAD 650 per tonne, a three-month low, as Statistics Canada’s upward revision to production estimates and improved crop conditions across the Canadian Prairies point to a larger harvest than previously expected. Recent rainfall in key regions like Saskatchewan has eased earlier drought concerns, prompting traders to unwind weather premiums. Globally, vegetable oil markets remain under pressure with soybean oil futures declining on weaker US export prospects and rising domestic stocks, while Euronext rapeseed and Malaysian palm oil also retreated amid tepid global demand and intensifying competition. Although US biofuel policy changes are boosting soybean crush, the resulting displacement of food and industrial use is only partially offset by increased reliance on alternative oils like canola and palm. However, this shift has yet to lift canola demand meaningfully, leaving prices exposed to further downside.

Rice futures slipped below $12.50 per hundredweight, approaching their weakest level since mid-May of $12.42 on July 7th, pressured by a global supply glut and sluggish export demand. Indian and Vietnamese export prices have edged lower while Thai prices remain stagnant as buyers delay purchases, anticipating further declines when new-crop supplies enter the market. Brazil faces its largest harvest in eight years, burdened by high carryover stocks and weakening export momentum, a situation worsened by the imposition of US tariffs on milled rice. Despite a slight reduction in US harvested area due to heavy spring rains disrupting planting in the Delta region, and lower domestic output, the USDA raised average US farm prices and revised ending stocks downward, providing some support. However, these bullish domestic factors are overshadowed by a projected global record harvest of 542 million tons in 2025/26 driven by larger crops in India, Bangladesh, Burma, and the Philippines.

The US government reported a $27 billion budget surplus in June, driven by a sharp rise in customs duties revenue, which hit a record $27.2 billion. This boost in tariff collections, especially from policies initiated under President Trump, helped push June budget receipts up 13% to $526 billion, while spending dropped 7% to $499 billion. However, adjusting for calendar shifts, the Treasury noted that June would have shown a $70 billion deficit. Year-to-date, the overall budget deficit rose 5% to $1.337 trillion, due to increased outlays on healthcare, Social Security, defense, and interest on debt. Customs receipts for the fiscal year reached a record $113.3 billion gross, signaling growing reliance on tariffs as a revenue source. Treasury officials anticipate further growth in tariff collections, possibly reaching $300 billion by the end of 2025. The administration is also preparing additional tariffs, including new sector-based duties on semiconductors and pharmaceuticals.

Uruguay's manufacturing output rose 3.1% year-on-year in May 2025, slowing from 7.2% in April and marking the smallest gain since August 2024. The strongest positive contribution came from Petroleum Refining, up 71.0%, as ANCAP resumed operations after months of maintenance. Motor Vehicles, Trailers, and Semi-Trailers followed with a 50.5% rise, and Paper and Paper Products grew 9.1%. The largest drag came from Food Products, down 2.0%, followed by Pharmaceuticals (-10.6%) and Leather and Related Products (-34.6%). The Hours Worked Index (IHT) fell 1.8% year-on-year, while the Employed Personnel Index (IPO) declined 1.1%.

Cotton futures eased toward 66 cents per pound in July, as global supply projections rise while demand fails to keep pace. The USDA’s July report raised US cotton production for 2025/26 by 600,000 bales to 14.6 million, driven by higher harvested acreage and lower-than-expected abandonment in key growing areas like the Southwest. Although average yields are slightly lower, the area expansion more than offsets it, lifting expected ending stocks by 300,000 bales and pushing the US stocks-to-use ratio to 32.4%. Globally, the outlook is similarly bearish as production was raised by 1.43 million bales, mainly from China and the US, while consumption increased only marginally. This leaves world ending stocks higher despite lower beginning inventories and reduced trade projections. In Brazil, unseasonable rains have delayed the harvest, but buyers are pushing prices lower due to concerns over quality and falling export benchmarks.

Stocks in the US pulled back on Friday after hitting record highs a day earlier, as President Trump escalated trade tensions with a 35% tariff on Canadian imports and floated broader tariff hikes of up to 20% on other trading partners. The S&P 500 slipped 0.3%, the Dow dropped 250 points, or 0.6%, while the Nasdaq 100 was down 0.2%, ending a strong streak driven by investor optimism. Trump's letter to Canada raised concerns and warned of further action if retaliation followed, while he also hinted at similar measures targeting the EU is expected shortly. Most sectors were in the red, with health and financials leading the losses, while energy and consumer discretionary were higher. Megacaps were mixed, with Apple (-0.6%), Meta (-1.4%), Broadcom (-0.8%), Alphabet (+1.5%) trading lower, while Microsoft (+0.4%), Tesla (+0.1%), Nvidia (+1%) and Amazon (+1.4%) were higher. For the week, the S&P 500 and Nasdaq were down 0.5% and 0.2%, respectively, while the Dow slipped 1.1%.

Corn futures fell below $4.0 per bushel in July, the lowest level since August 2024, driven by strong global supply prospects and signs of weakening demand. In the US, 74% of the corn crop was rated in good-to-excellent condition as of July 6th, well above the five-year average, while weather models point to continued favorable conditions across key Midwestern states. Similarly, Brazil is harvesting a large second crop, adding exportable supply at a time when the global market is softening. In Ukraine, export activity has slowed sharply, reflecting seasonal and traders are turning their focus to wheat and barley. On the demand side, fresh U.S. tariffs on Brazilian beef risk reducing feed demand, as Brazil may export less meat, lowering domestic corn consumption. Despite the USDA’s July WASDE trimming global corn stocks and production, its upward revision to U.S. ending stocks confirmed lingering supply overhangs, reinforcing the broader bearish tone.

Sugar futures rose above 16.5 cents per pound, extending gains following the USDA’s latest supply and demand estimates. The WASDE report showed that US sugar production was lowered to 9.19 million short tons, down 59,000 from last month, mainly due to reduced beet sugar output. Despite this decline, overall sugar supply rose to 13.808 million STRV, as higher beginning stocks and an increase in high-tariff imports offset the production cut. Imports from Mexico were trimmed by over 229K STRV under export licenses, though high-tier tariff imports were raised in anticipation of limited specialty quotas. Globally, Pakistan confirmed an import quota of 500K tons of refined sugar; the Philippines announced purchases of over 400K tons; and China recorded, in June, its largest quarterly import since 2018. Meanwhile, the impact of the US tariff on Brazilian sugar exports is expected to be limited, with ethanol exports facing greater pressure, given Brazil’s smaller share of the US sugar market.

Wheat futures dropped to $5.45 per bushel, pressured by stronger-than-expected yields in Kansas and following release of the USDA's WASDE report. Farmers in Kansas, the top winter wheat-producing state, reported favorable harvest results despite early season challenges, with some test weights and protein levels holding up well before recent rains impacted quality. The WASDE report showed a mixed outlook, projecting US wheat production at 1.929 billion bushels, up 8 million from last month due to higher yields despite reduced harvested acreage. Exports were raised by 25 million bushels to 850 million amid a strong pace of early sales, while ending stocks were trimmed by 8 million to 890 million. Globally, the wheat outlook reflected reduced supplies and ending stocks, with lower production in Canada, Ukraine, and Iran outweighing increases in the EU and Russia. World trade was revised lower due to weaker exports from the EU and Ukraine, though Russia and the US are expected to ship more

US gasoline futures climbed to around $2.19 per gallon in July, hovering at two-week highs tracking stronger crude feedstock costs and buoyed by firm summer travel demand following the July 4th holiday. Refiners have prioritized gasoline output amid favorable margins, even as OPEC+’s larger-than-expected 548,000 bpd production hike for August stoked oversupply concerns. The IEA’s latest report flagged softer global demand ahead, while rising US–China trade tensions added downside risk after President Trump confirmed 35% tariffs on Canadian goods from August 1st and signaled 15–20% levies on most other trade partners. On the supply side, unplanned refinery outages on the US East Coast, alongside ongoing Red Sea shipping disruptions, tightened regional availability and indirectly supported refined product premiums.

Next week, developments to US trade policy are set to continue impacting the outlook for global growth and market returns, coinciding with the first busy week of the earnings season and slew of major economic data releases. US President Trump is expected to continue delivering letters to notify countries of new tariff rates, including the EU. In the meantime, major US banks will dominate the earnings calendar with results due from JPMorgan, Bank of America, and Goldman Sachs, among others. Earnings are due from TSMC, J&J, ASML, Netflix, and 3M. On the data front, major releases will be headlined by the US CPI, which is expected to accelerate, while retail sales are set to stagnate. Inflation is also due from the UK, while the spotlight in the Euro Area will be members' trade balances and industrial production. Lastly, China's GDP growth is expected to have remained above the 5% target in Q2, while investors also await their trade balance, monetary aggregates, and July's data dump.

Argentina inflation seen accelerating in June after May slowdown.Argentina's monthly inflation likely ticked up to 1.9% in June, according to the median forecast of a Reuters poll, after May's rise marked the lowest monthly increase since 2020.

The annual inflation rate in Russia moderated for a third straight month to 9.4% in June 2025, the softest in seven months, from 9.9% in May. Still, it remains well above the central bank's 4% target. Prices increased at a slower pace for food (11.9% vs 12.5% in May), mainly fruits and vegetables (15.3% vs 19.8%); services (12.0% vs 12.6%) and non-food products (4.5% vs 4.8%). On a monthly basis, consumer prices rose by 0.2% in June, slowing from the 0.4% increase seen in May.

U.S. Dollar Tests New Highs Ahead Of The Weekend: Analysis For EUR/USD, GBP/USD, USD/CAD, USD/JPY.The American currency gains ground as traders focus on recent changes in Trump's tariff policy.

Heating oil futures climbed to around $2.44 per gallon in July, hovering at two-week highs as rising crude feedstock costs lifted refining margins and supported distillate values. Refiners, grappling with tighter sweet–sweet differentials and elevated run rates to meet peak summer transport and power-generation demand, have passed higher input costs through to heating oil prices. While the IEA warns of a potential surplus later this year and OPEC+ retains capacity to ramp output, current dynamics, marked by firm near-term demand and stronger crude benchmarks, continue to lift prices. Additional upward pressure stems from ongoing refinery maintenance that has sidelined roughly 500,000 barrels per day of distillation capacity on the US East Coast, tightening middle-distillate availability even as refiners favor gasoline production. Further compounding supply constraints, Houthi-linked attacks in the Red Sea have disrupted bunker fuel flows to Europe, amplifying cargo premiums.

Soybean futures fell toward $10 per bushel on Friday, pressured by a mixed outlook for the 2025/26 season following the USDA’s latest WASDE report. US production was trimmed slightly to 4.3 billion bushels due to reduced harvested acreage, while yields remained unchanged at 52.5 bushels per acre. Domestic crush was revised upward by 50 million bushels to 2.54 billion, reflecting stronger demand for soybean oil used in biofuel, driven by the EPA’s proposed Renewable Fuel Standard revisions and additional policy incentives. In contrast, exports were lowered by 70 million bushels to 1.75 billion, as robust domestic demand and increased global competition, particularly from Argentina, Ukraine, and Brazil, weighed on the outlook. On the global front, both production and crush are expected to rise, but exports are forecast to decline, contributing to higher global ending stocks, now projected at 126.1 million tons.

European shares end the week with a move to the downside..The major European indices are ending the week today with moves to the downside. However, for the week, share prices are higher.

The CAC 40 dropped 0.5% to close at 7,866 on Friday, ending a four-day rally, as escalating US–EU trade tensions and rising domestic inflation weighed on French stocks. President Trump’s unexpected announcement of a 35% tariff on Canadian imports, coupled with threats of broad 15–20% levies on other trading partners, stoked fears of retaliatory measures against European exports. At home, the latest price data showed June’s annual inflation rate climbing to 4.8%, a five-month high, raising doubts that the ECB will cut rates soon and hitting interest-sensitive sectors. LVMH, Hermès and Kering slid 3.4%, 1.5% and 3.7%, respectively, while Stellantis plunged 4.6%. Nonetheless, the index still managed a 2% gain for the week, its third consecutive weekly advance, buoyed by solid corporate earnings and expectations that a US–EU framework deal could be finalized once negotiations resume.

European stocks closed firmly lower on Friday amid the outlook of lower global trade flows. The STOXX 50 closed 1.1% lower at 5,380 and the STOXX 600 fell 1.1% to close at 547. Reports indicated that the EU Commission is set to receive an official tariff letter by US President Trump that places tariffs on the bloc, removing demand from key foreign clients for European corporate giants. This was after Trump announced a 35% tariff on Canadian imports starting August 1st and signaled plans to impose blanket tariffs of 15% to 20% on most other trading partners. Losses were distributed among most sectors, with LVMH, Kering, and Stellantis dropping close to 4% each while UniCredit, BBVA, and Nordea fell over 2% to lead the laggards among banks. Despite Friday's slump the STOXX 50 closed the week 1.7% higher, while the broader STOXX 600 added 1%.

In Milan, the FTSE MIB Index decreased 450 points or 1.11 percent on Friday. Losses were driven by Iveco Group (-5.94%), Stellantis N.V. (-3.81%) and Amplifon (-3.81%).

In Frankfurt, the DAX Index fell 202 points or 0.82 percent on Friday. Leading the losses are Puma (-3.67%), Siemens Healthineers (-3.13%) and Brenntag (-2.51%). Top gainers were Siemens Energy (1.89%), RWE (0.78%) and MTU Aero Engines AG (0.71%).

In Paris, the CAC 40 Index dropped 73 points or 0.92 percent on Friday. Losses were led by STMicroelectronics (-16.51%), Stellantis NV (-4.73%) and Kering (-4.12%). Offsetting the fall, top gainers were Thales (1.87%), Safran (1.01%) and TotalEnergies SE (0.77%).