Morning Money — Tuesday, October 20, 2026
INFLATION IS BACK ABOVE THE BANK OF CANADA’S COMFORT ZONE
Canada’s CPI rose 3.1% year over year in September, up from 3.0% in
August. Gasoline was the main driver, jumping 27.8%; excluding
gasoline, inflation eased to 2.2%.
Why it matters: headline inflation is now just above the Bank of
Canada’s 1%–3% target range. A rate hold is still expected on October
28, but another energy or tariff-driven price surge could revive hike
risk—important for variable-rate borrowers, mortgages and the loonie.
TRADE TENSIONS CLOUD THE OUTLOOK
The Bank of Canada’s latest surveys show business sentiment weakened
after Canada–U.S. trade talks broke down. Firms reported softer export
and hiring plans, while higher tariffs and energy costs are pushing up
price expectations. About half of consumers still expect a recession
within 12 months.
BEFORE THE BELL
• TSX futures: -0.13%. The index fell 0.7% Monday to 35,928.63.
• U.S.: Nasdaq-100 futures -0.62%; S&P 500 futures near flat as
AI-linked stocks weaken again.
• Oil: Brent around US$111.50, near a five-month high. That supports
Canadian energy shares and the dollar, but adds inflation pressure.
• Gold: -0.5% near US$4,121.
• Loonie: stronger near C$1.406 per U.S. dollar (about 71.1 U.S. cents).
EARNINGS & MOVERS
• RTX rose about 3% premarket after beating estimates, raising its
outlook and reporting a record US$340-billion backlog.
• Halliburton gained roughly 5.7% after an earnings beat.
• 3M edged higher after raising guidance and expanding its Amazon
data-centre partnership.
• GM beat forecasts, but shares fell about 5% as investors weighed its outlook.
• Netflix and SpaceX report after the bell; Meta and Tesla follow Wednesday.
WHAT TO WATCH
The key question is whether expensive oil remains a headline shock or
spreads into broader prices. That will shape the Bank of Canada’s
October 28 decision and Canadians’ borrowing costs.
