Resilient Global Economy Keeps Central Banks on Edge

The global economy continued to show signs of resilience this week, with both Canada and the US experiencing upward revisions in population growth and strong economic data.

In Canada, bond yields rose alongside US rates, leaving the key 5-year yield at its highest level since 2024. Despite weak population growth, household spending remained resilient in Q3, underpinned by accumulated wealth and some drawdown of savings.

The Bank of Canada is likely to remain on hold in October amid subdued core inflation and tariff-related growth risks, but high energy prices are boosting upside inflation risks.