Assessments of year-ahead business conditions rose by roughly 14%, yet the index was still 16% below its October 2025 level. At the same time, the decline in the Current Conditions subindex was driven entirely by views on buying conditions for durable goods, which fell 18% amid higher interest rates and mounting concerns about affordability.

Purchasing power continues to shape consumers’ views of the economy: overall sentiment now stands 10% below its level a year ago and 15% below its reading in February, just before the Iran conflict.

Year-ahead inflation expectations inched up to 4.7% from 4.6% in September, while long-run inflation expectations also rose, to 3.5% from 3.4%.

Financials weakened, with the major Canadian banks — RBC, TD Bank, BMO, Scotiabank and CIBC — each losing around 1%. Technology stocks also remained under pressure as investors continued to rotate out of AI-related names. Celestica extended its slide, dropping more than 3.5% after a 12% plunge in the previous session, while Shopify declined nearly 1%. Celestica is slated to report its third-quarter 2026 results on Monday. In the commodities space, gold prices were volatile and silver declined, weighing on mining stocks.

While the index remains below the 50 mark often viewed as a neutral threshold, the two-point increase suggests a slight uptick in confidence regarding current economic circumstances. The move from 44.7 to 46.7 indicates that, at the margin, households and consumers are feeling somewhat better about their immediate financial and economic environment than they did earlier in the period.

While the index remains below the neutral 50 mark—often seen as the dividing line between pessimism and optimism—the uptick suggests consumers are slightly less downbeat about future economic conditions than they were at the start of the period. The latest figures, updated on 23 October 2026, will be closely watched by markets and policymakers, as consumer expectations often influence spending behavior and, by extension, broader economic momentum.

The lack of movement in the indicator suggests that, at least for now, consumers are not revising their medium-term inflation views despite ongoing economic uncertainty. Stable long-term inflation expectations are typically viewed as an important signal for monetary policymakers, as they can influence wage negotiations, spending decisions, and broader financial conditions.

The data were last updated on 23 October 2026, confirming that October’s survey results show no shift in the perceived inflation path over the next five years. Investors and analysts will continue to monitor upcoming releases to assess whether this stability persists or gives way to renewed changes in sentiment./body

The stability of the indicator suggests that, at least for now, households are not revising their expectations for price increases over the coming year. The data, last updated on 23 October 2026, will be closely watched by policymakers and markets alike, as inflation expectations can influence wage negotiations, consumer spending, and central bank thinking on future interest rate moves.

While the change is minimal, sentiment remains firmly in subdued territory, suggesting that consumers are still wary about their personal finances and the broader economic outlook. The latest reading, updated on 23 October 2026, will likely be watched closely by analysts and investors for signs of whether consumer pessimism could weigh on spending and, by extension, future U.S. growth dynamics.

In the market, part of the investor community views a potential Flávio Bolsonaro administration as more inclined to contain public spending, even though neither the candidate nor his economic team has presented detailed fiscal consolidation plans so far.

Financial stocks mostly traded lower. Itaú slipped slightly, while Banco do Brasil and Itaúsa each declined more than 0.5%. Bradesco dropped nearly 2.5%, despite posting third-quarter results broadly in line with expectations and announcing a share buyback program.

In contrast, Petrobras advanced almost 2%, supported by higher oil prices after new attacks by Iran-backed Houthi militants in Yemen against Saudi Arabia. Vale gained close to 1%, tracking a rebound in iron ore prices.

The labor market also stayed robust, with employment rising at its fastest pace since June 2022 as firms expanded their workforces to meet stronger demand and work through growing backlogs. At the same time, intensifying cost pressures pushed selling-price inflation to its highest level since August 2022. Input costs climbed at their fastest rate since November 2022, excluding the spike seen in September.

Looking ahead, business confidence for the coming year softened slightly but still registered as the second-highest reading so far this year.

Despite the decline, the October reading remains well above the 50-point threshold that separates expansion from contraction, indicating that U.S. services activity continues to grow, albeit at a slightly slower rate than in the prior month. The latest data, updated on 23 October 2026, suggests that while momentum in the services economy has tempered, overall conditions remain robust heading into the final quarter of the year.

The October 2026 reading suggests that while the U.S. economy is still expanding, the pace of growth has moderated slightly compared with the previous month. Investors and policymakers may view the softer composite PMI as a sign of gradual cooling rather than a sharp slowdown, as both services and manufacturing activity remain in expansionary territory.

The latest data, updated on 23 October 2026, will factor into market expectations around the durability of U.S. economic growth and potential implications for corporate earnings and monetary policy in the months ahead.

While the 0.1-point increase is modest, it signals continued resilience in U.S. manufacturing activity rather than any loss of pace. The October 2026 figure builds on September’s solid performance, indicating that business conditions have remained broadly supportive for producers, with no sign in the data provided of a reversal in trend.

The latest PMI print will be closely watched by market participants and policymakers as an indicator of underlying industrial strength in the U.S. economy. With the index staying comfortably above the 50.0 threshold that separates expansion from contraction, October’s outcome reinforces the view that U.S. manufacturing continues to expand, albeit at a slightly faster rate than the previous month.

Iran’s army chief said the country’s military is prepared for asymmetric warfare following a buildup of its capabilities. At the same time, President Donald Trump stated that Washington is not negotiating with Tehran and hinted that new developments could emerge soon. According to reports, US and Israeli officials have already drawn up plans for renewed strikes following the US midterm elections.

Regional tensions have further escalated as Iran-aligned Houthi militants persist in attacking Saudi Arabia. In response, the US State Department has ordered non-essential personnel to leave the country. Saudi Aramco has also reportedly instructed employees to evacuate its Dhahran headquarters and continue working remotely.

Iran’s army chief said the country’s military was ready for asymmetric warfare following an upgrade of its capabilities. At the same time, President Donald Trump stated that Washington was not engaged in negotiations with Tehran and hinted that new developments could unfold soon. According to reports, US and Israeli officials have prepared plans for renewed strikes after the US midterm elections.

Regional tensions have also escalated as Iran-aligned Houthi militants continue to launch attacks on Saudi Arabia. In response, the US State Department has ordered non-essential personnel to leave the country. Saudi Aramco has reportedly told staff to evacuate its Dhahran headquarters and work remotely.

Industrials, communication services, and consumer discretionary shares led the market lower. Microsoft slipped 0.5%, Meta lost 1.9%, and American Express fell 1.7% despite posting earnings that beat expectations.

The recent rotation out of AI-related stocks continued, though at a slower pace, as chipmakers attempted a rebound and the broader technology sector hovered around the flatline. For the week, the S&P 500 was roughly unchanged, the Nasdaq Composite fell 0.5%, and the Dow Jones remained on track for a weekly gain of about 1.7%.

Brent crude rose to its highest level in more than five months after Houthi attacks in Saudi Arabia intensified worries about further disruptions to global energy supplies. At the same time, US consumer and producer inflation data released last week came in hotter than anticipated, largely due to higher energy costs, bolstering the case for a more restrictive monetary stance.

Even so, Federal Reserve officials are still widely expected to keep rates on hold at their October 27–28 meeting. According to CME’s FedWatch Tool, markets currently price in only about a 9% chance of a rate increase next week, versus better than an 80% probability for a move in December. Investors are also awaiting the US PCE inflation report on October 29 for additional insight into the Fed’s progress toward its 2% inflation target.

The Federal Reserve is due to announce its monetary policy decision next week, with markets assigning roughly a 91% probability that rates will remain unchanged. In contrast, the likelihood of a 25 bps rate hike in December was estimated at around 76%.

Among major currencies, the Japanese yen strengthened against the dollar, supported by its safe-haven status. The euro, by contrast, edged lower, weighed down by political uncertainty in France and persistent selling pressure in the country’s bond market.

While the indicator remains in negative territory, the move higher suggests that businesses are becoming slightly more confident about economic conditions. The October reading, updated on 23 October 2026, marks a continuation of a gradual recovery in sentiment, hinting that companies may be seeing fewer headwinds than in the previous month.

Investors and policymakers are likely to watch upcoming releases closely to assess whether this improvement in business climate can be sustained and potentially translate into stronger investment and hiring intentions in the months ahead.

Canadian government bond yields climbed, with markets increasingly pricing in a rate hike by the Bank of Canada at its next meeting, reflecting heightened energy-driven inflation pressures. Major Canadian banks listed in the US traded lower in overnight action.

Technology stocks remained under pressure, extending the ongoing rotation out of AI-related names. In the previous session, Celestica sank 12%, while Shopify also ended sharply lower. Celestica is scheduled to report its third-quarter 2026 results on Monday.

Elsewhere, gold prices were choppy and silver declined, adding to the drag on mining shares.

In August, the strongest growth in retail sales was recorded at motor vehicle and parts dealers (+1.2%), driven primarily by new car dealers (+1.5%). Higher sales at automotive parts, accessories, and tire retailers (+1.4%) were partly offset by declines at other motor vehicle dealers (-1.4%) and used car dealers (-0.5%).

Sales at gasoline stations and fuel vendors rose 1.7% in August, the first increase in three months. However, in volume terms, sales at gasoline stations and fuel vendors slipped 0.5%.

Retail sales also advanced at food and beverage retailers (+1.1%), general merchandise retailers (+1.0%), and health and personal care retailers (+1.6%).