Canada: Growth drag and steady BoC – NBC
Source Fxstreet
National Bank of Canada's (NBC) Taylor Schleich and Vy Le highlight that Canada’s 2026 Gross Domestic Product (GDP) forecast has been cut to 0.7%, leaving the economy lagging U.S. growth above 2%. They argue weak activity has offset recent inflation, allowing the Bank of Canada to avoid tightening. With core prices contained and energy risks receding, they expect Canadian inflation to glide back to 2% and policy to stay on hold into 2027.
Growth underperformance supports dovish BoC
"Bloomberg’s June economic survey (released Friday) offers another chance to highlight Canada’s ongoing economic struggles."
"Due to weaker-than-expected performance to start the year, the consensus forecast for 2026 Canadian GDP growth has been cut to just 0.7% (from 1.1%)."
"A weak economy has acted as a counterbalance to the recent inflation pop, allowing the BoC to hold off from tightening."
"And now, with core price pressures in check and energy risks receding, Canadian inflation is on a glide path back to 2%, which should keep the Bank sidelined into 2027."
"That’s hardly a controversial call as all but three (of 19) forecasters see the policy rate on hold this year."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Disclaimer: For information purposes only. Past performance is not indicative of future results.
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Bitcoin experienced a sharp decline this weekend, briefly erasing its 2025 gains and dipping below its year-opening value of $93,507. The cryptocurrency fell to a low of $93,029 on Sunday, representing a 25% drop from its all-time high in October. Although it has rebounded slightly to around $94,209, the pressures on the market remain significant.
The downturn occurred despite the reopening of the U.S. government on Thursday, which many had hoped would provide essential support for crypto markets. This year initially appeared promising for cryptocurrencies, particularly after the inauguration of President Donald Trump, who has established the most pro-crypto administration thus far. However, ongoing political tensions—including Trump's tariff strategies and the recent government shutdown, lasting a historic 43 days—have contributed to several rapid price pullbacks for Bitcoin throughout the year.
Market dynamics are also being influenced by Bitcoin whales—investors holding large amounts of Bitcoin—who have been offloading portions of their assets, consequently stalling price rallies even as positive regulatory developments emerge. Despite these sell-offs, analysts from Glassnode argue that this behavior aligns with typical patterns seen among long-term investors during the concluding stages of bull markets, suggesting it is not indicative of a mass exodus.
Notably, Bitcoin is not alone in its struggles, as Ethereum and Solana have also recorded declines of 7.95% and 28.3%, respectively, since the start of the year, while numerous altcoins have faced even steeper losses.
Looking ahead, questions linger regarding the viability of the four-year cycle thesis, particularly given the increasing institutional support and regulatory frameworks now in place in the crypto landscape. Matt Hougan, chief investment officer at Bitwise, remains optimistic, suggesting a potential Bitcoin resurgence in 2026 driven by the “debasement trade” thesis and a broader trend toward increased adoption of stablecoins, tokenization, and decentralized finance. Hougan emphasized the soundness of the underlying fundamentals, pointing to a positive outlook for the sector in the longer term.
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