观点

Overall inflation-adjusted growth in personal disposable income has ground to a halt (chart 8).

Consecutive large job gains in Canada over the summer, combined with increasingly constrained labour supply from worker retirements and reduced immigration pushed Canada’s unemployment rate down to 6.4% in July.

but we remain cautiously optimistic that per-worker labour markets in Canada will continue to gradually improve, with the unemployment rate edging lower into 2027.

With no resolution to the US-Iran conflict in sight, energy prices remain high and volatile.

Conditions are even tighter in Europe, where diesel has risen above USD 200 per barrel, more than USD 105 above Brent and well above the USD 28 per barrel at which the spread traded this time last year.

higher energy prices pushing up global energy inflation, including in Canada

still-elevated global energy prices as a result of the Strait of Hormuz remaining largely closed

Brent and WTI prices, however, edged lower, settling at USD95.6/barrel and USD91.0/barrel, respectively.

Brent crude oil topped USD 95 after the US-Iran conflict escalated further as American forces launched fresh strikes and Tehran retaliated.

Oil prices are under slightly further upward pressure this morning after surging yesterday because of US-Iran hostilities.

As Iran conflict drags on, verbal intervention may no longer be enough to suppress prices.

The Japanese yen rallied sharply Wednesday on no readily identifiable catalyst, sparking rumours of a fresh wave of official intervention to strengthen the currency. The move unfolded as USDJPY was trading above 159.50 and it spiked as low as 158.22 before rebounding to 159.00 and then dipping again early Thursday as low as 157.55.

The Swiss franc dipped to an almost two-week low versus the euro, as EURCHF pulled toward 0.9400 early Tuesday, with the cycle and 12-month high from early August at 0.9411, as global bond yields rose, encouraging carry traders funding in francs.

The US dollar rose sharply on Fed Chair Warsh’s hawkish speech. USDJPY traded through 160.00 Friday and briefly in early Monday trading for the first time since the official intervention in late July and at the beginning of August.

Since 2019, eurozone imports from China have grown by around 50% while exports to China have declined, widening the eurozone goods trade deficit with China by more than €150bn.

The eurozone combines high household wealth, substantial private savings and relatively low levels of household leverage with significant investment needs in defence, infrastructure, energy and digitalisation.

There are remarkably few examples of countries that have successfully moved from an export-led to a domestically-driven growth model.

Eurozone population growth is grinding to a halt due to rapid ageing, and ageing societies are not natural consumption machines.

Healthcare REITs have likewise benefited from favorable demographic trends. An aging US population is supporting demand for senior housing and other healthcare-related properties, while limited new supply has helped improve occupancy and pricing power across several healthcare subsectors.

Italy’s dependency ratio (the population aged over 65 relative to those aged 15 to 64) is projected to be the highest in the European Union in 2025, at 39%.

Brent and WTI prices, however, edged lower, settling at USD95.6/barrel and USD91.0/barrel, respectively.

And we also see value in maintaining a strategic allocation to gold, which can complement these positions with robust central bank demand, and its role as a portfolio hedge against currency debasement and US fiscal pressure.

Use of AI is increasing services imports, either directly as Computer & Information services, or as intellectual property licencing, distributed by domestic companies. Imports growth in these categories has been very strong for a while, and that trend is set to continue.

The India-US AI Opportunity Partnership is a further testament to both countries’ shared ambition to build resilient AI ecosystems.

The resumption of the Iran-US peace process, on the other hand, would calm geopolitical tensions and help oil prices return to prewar levels, which in turn would be supportive for the inflation outlook.

Combined with an unresolved situation in both the Gulf region and Black Sea, this suggests that a return to 2% inflation is still some way off.

That said, we are maintaining our credit profile on the company given the company’s refocus on the oil and gas business and prioritisation to strengthen its balance sheet.

Australia: Q2 GDP and partials, private credit, current account, dwelling approvals, goods trade balance.

Howard Lutnick told CNBC that the Trump administration is preparing broader tariffs on semiconductor imports, although companies manufacturing chips in the US could receive some relief.

As the expansion in Section 301 has roughly the same coverage as the Section 122 duties, we expect the average effective tariff rate to hold near 7% next year.

The latest MAS SPF survey also showed a median forecast upgrade in the 2026 manufacturing growth from 5.0% to 8.4% (OCBC forecast: ~9%) and GDP growth forecast from 3.5% to 5.0% (OCBC: 5.2%).

We have revised up our outlook and now expect farm GVA to grow 0.9% in 2026, from the 0.8% contraction forecast previously.

We expect the Commodity Price Index to rise 6.3% in 2026 before declining -2.3% in 2027, though prices across several commodities are expected to remain above their longer-run averages.

We expect the EYCI to end 2026 around A$9.49/kg cwt.

We expect ASW prices to end 2026 around A$332/t before easing to around A$290/t by end-2027.

ABARES expects Australian wheat production to fall 17% in 2026-27, though output would still remain above the ten-year average.

A strong El Niño event has been declared and is expected to persist into mid-2027. While this increases the risk of a drier and warmer season, it does not guarantee a drought.

China's beef safeguard quota was reached in mid-June, lifting tariffs on further shipments to 55%, while South Korea's quota was exhausted in late July.

The US has also launched an investigation into lamb imports that could see tariffs or quotas applied from early 2027.

Global dairy prices have softened as supply improves, though skim milk powder has outperformed as demand shifts from fats towards proteins.

El Niño remains an upside risk to prices and a downside risk to production.

Australian production is expected to fall by around 5% in 2026-27 but remain around 37% above the ten-year average.

Sugar prices have recovered from the lows seen earlier in 2026 as the global market moves from surplus to deficit.

Against this backdrop, we continue to expect the goods trade balance to trend lower over the coming quarters, dragging the overall current account balance down with it.

Exports of the three major commodities – iron ore, coal, and LNG – rose only 0.4%mth, as an increase of close to 10% in LNG exports offset declines in iron ore and coal.

As long as the economy continues to embrace AI, and Australia remains an attractive location for the data centres needed to support it, ADP imports are likely to remain strong.

The recent appreciation of the AUD is an additional headwind for exports, and we do not expect this effect to reverse.

Crude prices steadied after a three-day rally, with Brent holding near USD 95 as President Donald Trump said renewed attacks on Iran would be short-lived, while US officials said 17 million barrels of oil exited the Strait on Monday, signalling robust flows through the waterway.

What you're seeing is a change, a structural change that's occurred over a number of years, but a 30-year period where yields and interest rates were falling is now being reversed

In the US, 10-year Treasury yields this week reached a near three-year high of around 4.8%, while Japan's equivalent yield moved above 3% for the first time in 30 years.