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Market Review – September 2021

In this month’s market review, our Chief Options Specialist, Jason Ayres, reflects on the September market conditions.

As we move towards the end of September, we are seeing some weakness across the board as investors grapple with the risk of the new Delta Variant and what that might mean for the global recovery.

Prices in retail stores are looking a little more costly than normal as supply chains continue to try to match the demand for everyday goods. Inflation will continue to be elevated in the medium term.

For Canada and the U.S., corporate earnings have been very strong, and the job numbers have been promising. That said, there are more position openings and less demand for jobs in the U.S. This should end once government benefits expire, and unemployment rates will go back to pre-pandemic levels.

The ongoing pandemic continues to hinder the economic recovery.

Investors continue to watch the U.S. Federal Reserve and the Bank of Canada. Both have taken a dovish wait-and-see approach. Central bank balance sheets continue to balloon. The Federal Reserve said they would keep interest rates unchanged but will start to withdraw support soon.

Lastly, after a steady spring, the Canadian dollar has recently come under pressure in relation to the U.S. dollar.

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