Stock Market’s Up, Interest Rates are Down, What’s Next for Canada?

Rate Cut, Weak GDP, and a Stock Market still marching forward.

Hope your month is off to a wonderful start!

Let’s break down what just happened in the Canadian markets last week, and why it matters for your money:

1. TSX closes October on a high note

The TSX rose 0.3% on Tuesday to finish the month at 30,260, (up 0.8% in October). That marks six straight months of gains, the longest monthly winning streak since 2021.

Despite a few headwinds, optimism is holding steady as we enter what’s historically a strong season for the market.

2. Tech leads the charge, even with soft GDP data

Canadian GDP shrank by 0.3% in August, a negative surprise that raised some concerns about a broader economic slowdown.

But Canadian tech stocks helped cushion the blow. Shopify ($SHOP-TO), Celestica ($CLS-TO), and others rebounded.

Magna International ($MG-TO) also surged 6% after posting stronger-than-expected earnings and lifting its sales forecast.

3. Bank of Canada cuts Rates again

The BoC delivered a second straight 0.25% rate cut, bringing its benchmark rate down to 2.25%.
But Governor Tiff Macklem signalled the bank may pause here, citing the need to monitor the effects of past cuts and trade uncertainty.

Translation: The BoC is trying to support growth without oversteering in a fragile environment.

➡️ What this means for you:
Interest rates on savings accounts and GICs may dip slightly over time, while borrowers with variable-rate debt (like lines of credit or some mortgages) could see small relief in payments.

4. Gold and trade tensions stir unease

Gold fell 0.7% Friday, slipping below the $4,000/oz mark as investors rotated into equities.

Meanwhile, Canada–U.S. trade tensions are back in the spotlight. Donald Trump halted talks after Ontario aired a Reagan-inspired anti-tariff ad during the World Series.

Doug Ford paused the campaign… but the damage may already be done.

Trade uncertainty adds another layer of risk for Canadian exporters heading into the winter months.

📆 What to Watch Next:

📅 Nov 4: Federal Budget 2025
Canada’s government will table its budget on Tuesday. Expect updates on spending priorities, tax changes, and how they plan to manage the deficit… all of which can impact consumer confidence, small businesses, and financial markets.

📅 Nov 7: October Jobs Report
Stats Canada will release fresh employment data Friday. A weak report could revive rate cut expectations, while strong job gains might extend the Bank of Canada’s pause.

Even with soft GDP and rising global risk, markets are holding on… but it’s a balancing act.

Rate cuts, trade tensions, and slowing growth all have a role to play in shaping how the next few months unfold.

If this helped you understand what’s going on in the markets, share it with a friend or sign-up for my weekly Canadian finance newsletter: 📩 [Subscribe here]