Market Update: Inflation and Trump-Xi Meeting

Date: May 13, 2026

Author: Elior Manier

Overview

The article provides a mid-week review of significant developments in North American and global markets, focusing on the anticipated meeting between U.S. President Donald Trump and Chinese President Xi Jinping in Beijing. This meeting is seen as a pivotal moment for geopolitical and economic relations, especially in light of previous concerns regarding de-globalization.

Key Developments

• The Trump-Xi summit is expected to yield important outcomes that could alleviate fears surrounding global trade tensions.
• Despite the U.S.-Iran conflict receiving less media attention, its impact on inflation is becoming increasingly evident, with inflation rates rising sharply.
• Recent economic reports indicate a significant increase in inflation, with the Consumer Price Index (CPI) rising by 3.7% and the Producer Price Index (PPI) showing a year-over-year increase of 5.2%.

Market Reactions

In response to these developments, most asset classes are in a state of consolidation, with WTI Crude Oil prices rising above $100 due to ongoing supply shortages. The inflation reports suggest that the Federal Reserve may not consider rate cuts in the near future, complicating monetary policy decisions.

Currency and Index Performance

The U.S. Dollar is gradually recovering, approaching the 98.50 pivot zone, while the Canadian Dollar is losing ground against major currencies despite rising crude oil prices. The article highlights the performance of North American indices, noting that the Nasdaq and Japanese Nikkei 225 have outperformed more traditional indices like the TSX and Dow Jones.

Technical Analysis

Key resistance and support levels for the U.S. Dollar and USD/CAD are outlined, indicating potential trading strategies for market participants. The article emphasizes the importance of monitoring upcoming economic releases, including the NY Fed Empire Manufacturing report and Canadian CPI data.

Conclusion

The article concludes with a reminder for traders to stay informed about the evolving economic landscape and to prepare for potential volatility as the Trump-Xi meeting unfolds and new economic data is released.