Key Focus This Week “Nvidia Earnings, Inflation Data, and Policy Signals in Focus”

Following a week marked by persistent inflation readings and moderating growth signals, investor attention now turns to a critical mix of corporate earnings, fresh inflation data, and policy commentary that could shape near-term market direction.
Earnings season remains a key driver, with NVIDIA set to report on Wednesday. As a leading beneficiary of the artificial intelligence investment cycle, Nvidia’s results are expected to provide insight into the sustainability of AI-related capital spending and semiconductor demand. Given the company’s substantial weighting in major indices, its earnings could significantly influence broader equity sentiment, particularly within the technology sector. Additional reports from Salesforce, Synopsys, and Dell Technologies will further clarify trends in enterprise software, chip design, and AI infrastructure spending.
On the economic front, U.S. Producer Price Index (PPI) data for January will be released on Friday, offering another measure of upstream inflation pressures. Markets will assess whether producer prices confirm the recent persistence observed in consumer inflation data, which could influence expectations regarding the timing of potential policy adjustments by the Federal Reserve.
In Canada, fourth-quarter GDP data will be closely monitored for evidence of continued economic deceleration following softer inflation readings earlier this month. The growth data may shape expectations for future moves by the Bank of Canada, particularly if economic momentum shows further moderation.
In addition, markets will monitor remarks from U.S. President Donald Trump on Tuesday, as policy commentary may affect investor sentiment, particularly regarding fiscal priorities and trade policy direction.
With inflation signals, major technology earnings, and policy developments converging within a single week, markets may remain sensitive to data surprises and forward guidance, particularly in rate-sensitive and growth-oriented sectors.

Last Week’s Key Economic Data & News Recap

Sticky Inflation and Slowing Growth Shape Policy Outlook

U.S. inflation and growth dynamics during the week continued to signal a challenging policy environment for the Federal Reserve. The Federal Reserve’s preferred inflation gauge, the Personal Consumption Expenditures (PCE) Price Index, showed that inflationary pressures remained more persistent than markets had hoped. According to official data, the PCE index rose 2.9% year-over-year in December 2025, up from 2.8% in November, while core PCE (excluding food and energy) increased 3.0%, also above prior readings. The monthly pattern showed a 0.4% uptick in both headline and core inflation in December, reflecting broad price gains across services and consumer spending categories, and slightly above several economist forecasts.
This persistently elevated inflation trend, remaining above the Federal Reserve’s 2% target despite slowing headline metrics, reinforces expectations that policymakers may be reluctant to enact near-term rate cuts. At the same time, the U.S. economy’s growth trajectory moderated noticeably: the advance estimate for fourth-quarter 2025 real GDP showed annualized growth of 1.4%, down sharply from 4.4% in the prior quarter, underscoring a deceleration in economic momentum.
Taken together, these data create a complex policy picture: inflation remains sticky even as growth softens, likely tempering the pace and timing of interest rate adjustments. Markets responded to this juxtaposition with volatility in rate-sensitive assets and shifting expectations for future monetary policy.

Canadian Inflation Moderates in January

Canada’s latest inflation figures, released by Statistics Canada, indicated further moderation in consumer prices for January 2026. The headline Consumer Price Index (CPI) rose 2.3% year-over-year, down from 2.4% in December, with the deceleration largely driven by a sharper decline in gasoline prices. Excluding food and energy, CPI increased 2.4%, slightly below the prior month’s pace.

Core inflation measures, such as CPI-median and CPI-trim, commonly monitored by the Bank of Canada, also eased modestly, reinforcing indications that underlying price pressures were approaching the central bank’s target range.

While the Bank of Canada has maintained its policy rate in recent months, these softer inflation dynamics may provide additional room for policy flexibility if economic growth indicators soften further. The Canadian dollar showed modest depreciation against the U.S. dollar following the release, reflecting market reassessment of relative policy trajectories.

Supreme Court Tariff Ruling Eases Trade Uncertainty

A U.S. Supreme Court decision during the week significantly curtailed most of the prior administration’s tariff regime, effectively striking down key tariff measures that had been applied to a range of imported goods. While the ruling’s direct market impact was measured, it holds broader implications for trade policy, cost structures for importers, and inflation expectations over the medium term.
Analysts have noted that reducing tariff-related price distortions may remove an upward pressure on goods inflation that has complicated broader price stability efforts. The decision also contributes to a more predictable trade environment for multinational firms. Markets are likely to monitor subsequent tariff and trade policy developments for their influence on global supply chains, inflation, and corporate margins.