Market Overview: Key Events and Economic Data

### European Session In the European session, the agenda features limited economic releases, including the German Producer Price Index (PPI) and Eurozone Construction Output. These indicators are not expected to influence the European Central Bank's (ECB) current stance.

The primary focus remains on developments related to the US-Iran situation, with a US official indicating plans for a broader military engagement and the Pentagon increasing its military presence in the Middle East. This backdrop is contributing to a risk-off sentiment in the markets, as rising oil prices reignite concerns over inflation and economic growth.

### American Session In the American session, attention will turn to the Canadian Consumer Price Index (CPI) report. The headline CPI year-over-year is anticipated to be 2.9%, down from 3.2% previously, while the Trimmed-Mean CPI year-over-year is expected to remain steady at 2.0%. Given that this data pertains to June, it may be considered outdated in light of the recent escalation in the Middle East and the closure of the Strait of Hormuz.

Currently, Canadian core inflation is aligned with the Bank of Canada's target of 2%, and the central bank appears hesitant to raise interest rates without clear evidence of broader inflationary pressures.