Market Watch

Given the ongoing uncertainty regarding global trade and tariff issues, the Bank of Canada (BoC) continued to hold interest rates. On June 4, the BoC’s target overnight rate remained at 2.75%, the second straight decision to maintain the current rate after a series of consecutive cuts had trimmed rates by 225 basis points.¹ It’s unclear how long these trade issues may last and what economic impact they could have, so the BoC felt it was prudent to take a wait-and-see approach. The next BoC interest rate announcement is scheduled for July 30.

Based on the Consumer Price Index (CPI), year-over-year inflation in Canada rose by 1.7% in May, identical to April’s year-over-year CPI gain. The cost of shelter grew at a slower pace in May, particularly for rent, while prices for new passenger vehicles – especially electric vehicles – increased at a faster pace than in April. Gas prices continued to decline, down 15.5% in May (year-over-year) after slipping 18.1% in April, largely as a result of the removal of the consumer carbon tax.² How much Canadians save from this tax break will vary based on usage patterns and where they live, but it’s been estimated, for example, that the average Ontario family could save almost $500 per year.³

Regarding labour data, employment in Canada rose marginally in May, with a gain of 8,800 jobs following two months of declines in the job market. The employment rate remained at 60.8%, while the unemployment rate rose by 0.1 percentage points in May, to 7.0%. Gains in full-time work and within the private sector (led by wholesale and retail trade) were offset by losses in part-time jobs and within the public sector (particularly in public administration).⁴

In the Spotlight – Your journey to a fulfilling retirement

Whether retirement is decades away or just around the corner, having a plan makes all the difference. In fact, as we all live longer and likely spend more time retired, such planning can be incredibly valuable. Your approach will naturally change depending on how close you are to retirement, but everyone needs a thoughtful, personalized plan to help you enjoy a meaningful and financially secure retirement.

Quick Fact

In a CPP Investments survey, over 60% of Canadians said they fear running out of money in retirement. The survey also showed that people with a financial plan are less concerned about outliving their retirement savings.

The Good in Banking is Getting Better!

Growing together for good.
A proposed merger between Alterna Savings and Tandia could bring even more value to you.

Together we create a $13.2 billion credit union with:

• Expanded branch access in the
  Hamilton/Halton region
• Enhanced capabilities to invest in digital innovation
• Product innovation with even more competitive rates

By combining our strengths, we could build an even more resilient, credit union, focussed on your future.

Stay informed:
Visit TogetherWeWillGrow.ca regularly for updates on the merger, voting information, and learn how we anticipate this merger could deliver even more of the good in banking for you.

<sup>1. https://www.bankofcanada.ca/core-functions/monetary-policy/key-interest-rate/
2. The Daily — Consumer Price Index, May 2025
3. https://globalnews.ca/news/11085217/canada-carbon-price-cancelled-potential-savings/#:~:text=The%20
average%20family%20in%20Ontario,$133%2C%20according%20to%20the%20estimates.
4. https://www150.statcan.gc.ca/n1/daily-quotidien/250606/dq250606a-eng.htm?indid=3587-1&indgeo=0</sup>