Launch Pad

China is stepping up diplomatic pressure to resolve the Iran war, with officials urging for the reopening of the Strait of Hormuz ahead of a high-stakes meeting between Xi Jinping and Trump. The push reflects China’s need for stabilized global energy markets, given its heavy reliance on Middle Eastern oil. That’s not all though, with experts noting that China is also trying to position itself as a key geopolitical mediator. Progress toward reopening the strait and potentially easing U.S. sanctions, has already moved energy markets, highlighting how central this chokepoint is to global economic stability. 

Economic activity in Canada rebounded in April, with the Ivey PMI jumping back into expansion territory and signalling the strongest activity in seven months. The improvement was broad-based, with both employment and hiring picking up, suggesting underlying resilience in the domestic economy despite ongoing global uncertainty. However, the rise in the prices index highlights growing cost pressures, likely tied to higher energy and commodity prices, which could complicate the outlook for inflation. For the BoC, this combination of stronger growth and rising price pressures reinforces a cautious policy stance, as the economy appears to be holding up better than expected but with inflation risks still very much present. 

There will be more employment reports to parse through this week, with investors awaiting tomorrow’s jobs data out of Canada and the U.S. These reports are pivotal for markets as they will help determine whether the holdings of rates remain intact for the BoC and the Fed or whether meaningful labour market softening could reopen the door to rate cuts. For now, resilient growth, sticky inflation, and geopolitical energy shocks have reduced expectations for near-term easing, making labour deterioration the primary catalyst that could shift policy expectations. However, even a weaker jobs report may not be enough on its own unless accompanied by sustained unemployment increases and broader economic softness. 

Benchmarks for private markets. JPMorgan has introduced a new index tracking roughly 6,400 U.S. middle-market private companies with a combined $1 trillion in annual revenue. The index aims to provide more visibility into a segment that has historically been difficult to track. The J.P. Morgan Private Assets Index (JPAX) – Middle Market covers firms with $10 million to $1 billion in revenue and estimates performance using company financials alongside public market valuation proxies. It is designed as a diagnostic tool, not a tradable benchmark, reflecting the structural limitations of private market data. The introduction comes as the number of public companies has declined while private firms have grown, highlighting a gap in measurement. In short, this is less about investability and more about building the infrastructure to better track and understand private market performance. 

Still living at home or have kids still living at home? That just means you’re part of the trend. A new study from Stats Canada shows millennials are twice as likely to live with their parents as baby boomers were at the same age, with over 16% of those aged 25 to 39 living at home in 2021 versus 8.2% in 1991. The trend is more pronounced in expensive cities like Toronto and Vancouver. At the same time, homeownership rates have declined, with just under half of millennials owning homes compared to roughly 56% for both boomers and Gen X at similar ages, and those who do own are less likely to live in detached homes. While affordability is a key factor, the shift also reflects delayed marriage, parenthood, longer periods in education, and changing demographic patterns. Homeownership rates remain stable for those in partnered households, reinforcing the role of household formation. With first-time buyers entering the market later, part of the gap reflects delayed entry rather than permanent dislocation. 

Gold prices extended gains for a third day as optimism over a potential U.S.-Iran deal pushed down oil and gas prices, diminishing concerns of inflation. Silver also rose more than 3%, after jumping 6.2% in the previous session. Falling energy prices weigh on bond yields, and with the U.S. dollar back to pre-war levels, these are both tailwinds for bullion. Despite oil prices lowering, Federal Reserve Bank of Chicago President Austan Goolsbee and President of St. Louis Fed Alberto Musalem struck a note of caution, highlighting that inflation concerns remain as it is still running above the target of 2%. Gold has fallen more than -10% since the conflict erupted in late February, as the closure of Hormuz and resulting energy price shock raised concerns about rising inflation that would keep rates higher for longer.