European Central Bank policymakers don't generally expect evidence that stubborn inflation is easing to be clear enough for them to pause the longest streak of interest rate hikes in the ECB's history this summer, sources told Reuters.

Conversations with seven rate-setters at the ECB's annual forum in Sintra, Portugal, showed most expected to increase borrowing costs again at both its July and September meetings despite signs the euro zone economy is flagging.

The ECB raised its interest rates to their highest level in 22 years this month and said a ninth consecutive rate hike was all but guaranteed in July as it predicted inflation would stay above its 2% target through the end of 2025. (Continue Reading - Reuters)

Canada's annual inflation rate came in at 3.4% in May, its slowest pace in two years, data showed on Tuesday, weakening the case for another interest rate hike as soon as next month.

Analysts polled by Reuters had expected annual inflation to drop to 3.4% from 4.4% in April. Month over month, the consumer price index was up 0.4%, Statistics Canada said, a tick lower than forecasts for an increase of 0.5%.

Grocery prices also continued to surge, rising 9% year over year in May, nearly unchanged from the increases recorded in April. (Continue Reading - Reuters)

Don’t be fooled by the sleepy stock market. 

Stocks have quietly climbed through the first half of the year, sending the S&P 500 up 13% and measures of market volatility to depths not seen since before the start of the Covid-19 pandemic. 

The Cboe Volatility Index, or the VIX, has fallen to around 14, near the lowest levels since February 2020. Known as Wall Street’s fear gauge, the index tracks the price of options often used to hedge against stock-market downturns.

Yet traders are pointing to a handful of signs, such as positioning in the options market and mammoth swings in some individual stocks, that suggest volatility has been brewing under the surface. (Continue Reading - Wall Street Journal)