Canada’s economy regained momentum last month, potentially reinforcing the case for a July rate hike even as inflation slowed, Bloomberg News reported. Preliminary data suggest gross domestic product expanded 0.4% during the month, Statistics Canada reported Friday in Ottawa, led higher by manufacturing, wholesale trade and real estate. That followed a flat reading in April, missing expectations for a 0.2% increase in a Bloomberg survey of economists, in part due to a federal workers’ strike. March growth was revised upward to 0.1%.

Canadian businesses still see inflation running high before edging down slowly, the Bank of Canada said on Friday in a second quarter survey at a time when labor market and wage pressures are seen easing, Reuters reported. Most businesses expect to hire over the next year, but fewer than in the first quarter and about half the number of a year ago. Those seeking to hire expect a labor shortage to be less intense than in previous quarters.

The Bank of Canada's move to come off the sidelines after a five-month pause has sent a signal that some economic pain will be needed to tame stubborn inflation, leading investors to raise bets on a hard landing for the economy, Reuters reported. The central bank is worried that the Canadian economy is running too hot for inflation to return to its 2% target and that if it waits to act, inflation expectations could rise, making matters worse. Immigration, a key source of strength for the economy, is growing at a record pace.

The general secretary of Canada Soccer insisted on Monday evening that the organization was not considering bankruptcy, contradicting news reports it was mulling the move to escape the dire financial straits it has been in since the men’s national team qualified for last year’s FIFA World Cup, the Globe and Mail reported. “Absolutely, unequivocally, we are not contemplating bankruptcy,” said Jason deVos, during an interview with The Globe and Mail.

Canadian inflation slowed to its weakest pace in two years and core measures edged lower, reducing pressure on the central bank for another interest-rate hike next month, Bloomberg News reported. The consumer price index rose 3.4% in May from a year ago, the smallest increase since June 2021, Statistics Canada reported Tuesday in Ottawa. That matched the median estimate in a Bloomberg survey of economists and was down a full percentage point from 4.4% in April. On a monthly basis, the index rose 0.4%, also matching expectations.

The Bank of Mexico maintained its benchmark interest at 11.25% on Thursday for the second time, signaling it will hold the rate "for an extended period" as inflation in Latin America's second largest economy slows but remains above the bank's target, Reuters reported. The unanimous decision by the central bank's five-member board was in line with analysts' forecasts and came as data shows annual inflation at its lowest in more than two years.

The Dominican Republic's real economic growth is projected to decelerate slightly to around 4% this year due to delayed effects of financial tightening and lower global demand, the International Monetary Fund (IMF) said on Thursday, Reuters reported. The Caribbean country's economy is expected to return to its trend of about 5% expansion next year, as global financial conditions and the world economy recover, the IMF said in a statement. Read more.

The Bank of Canada agreed that the need for further rate hikes would be determined by fresh economic data after it lifted rates to a 22-year high earlier this month, minutes from their policy meetings released on Wednesday showed, Reuters reported. Analysts said the tone of the notes made it clear the central bank was likely to raise rates again next month. On June 7 the bank, which had been on hold since January, raised its overnight rate to 4.75%. In its summary of deliberations, or minutes, the governing council said growth and inflation had been stronger than expected.

Canadian retail sales grew much more than expected in April and will likely post another gain in May, data showed on Wednesday, bolstering the chances that the Bank of Canada will raise rates again in next month, Reuters reported. Retail sales climbed 1.1% in April, higher than a median forecast for a 0.2% increase, Statistics Canada said. In a preliminary estimate, Statscan said sales increased by another 0.5% in May.

Bond investors in Credito Real SAB are crying foul after being left in the dark for more than a year in one of the largest corporate blowouts in Mexico’s recent history, Bloomberg News reported. After defaulting on $1.9 billion of dollar bonds in February 2022, the non-bank lender embarked on a liquidation process in a Mexico City court that bondholders say has been tilted against them. Now, lawyers are pushing for a deal that they say would allow creditors to recoup as much as 23 cents on the dollar.