FX.co ★ TSX Eases From Record High

The S&P/TSX Composite Index declined by approximately 0.2%, falling below the 27,150 level on Tuesday. This drop follows its previous record-high, as persistent inflation has bolstered the belief among financial analysts that the Bank of Canada (BoC) will maintain its current hawkish monetary policy stance. It is expected that the BoC will keep its overnight interest rate at 2.75%, resisting any urge to shift toward easing too soon. Although June's Consumer Price Index (CPI) registered a modest 1.9% increase, the persistent 3% core inflation rate has dashed hopes for immediate rate cuts and led to profit-taking in equities sensitive to interest rates. On the international stage, President Trump's recent threat to impose 30% tariffs on imports from the European Union and Mexico, alongside existing tariffs on Canadian goods not included in USMCA exemptions, has stirred anxiety. This could potentially impact Canada's key export sectors such as mining, forestry, and automotive. Consequently, companies like Agnico Eagle and Wheaton Precious Metals led the downturn, with each posting losses around 1%, while Shopify's value fell by approximately 0.7% and the financial sector also trended downwards.