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North American equity markets are flirting with new highs, even as the incoming U.S. administration introduced fresh uncertainty.

Global equity markets have drifted lower recently

A continued decline in inflationary pressures, coupled with ongoing signs of a cooling Canadian economy, prompted the Bank of Canada (BoC) to make its third consecutive interest rate cut this week.

Global markets moved higher over the past couple of weeks, with the Canadian equity market rebounding to new highs and U.S. equities nearing their mid-July peak.

Global equity markets have recently retraced some of their year-to-date gains, while government bond yields have fallen.

The Bank of Canada cut interest rates for the second consecutive time. Meanwhile, global equities have been weaker

One notable development was the Canadian inflation report for May, which was higher than expected for the first time this year.

Global equities have been a bit more mixed of late with Canadian and European equities weaker in recent weeks, though year-to-date gains remain respectable.

Investor attention has turned to Canada over the past few weeks due to a slew of economic releases and earnings reports from Canadian banks.