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Commentary

Q2 2026 Fund Commentary

Commentary and opinions are provided by Mackenzie Financial Corporation

Market Commentary

Canada spent the second quarter of 2026 debating whether it was in recession. The Bank of Canada (BoC) held its policy interest rate at 2.25% in April and June, with core inflation near 2% and little energy pass-through. Gross domestic product (GDP) rose 0.5% in April month over month, taking some air out of the recession narrative, though May’s GDP flash reading was just 0.1% month over month.

Outlook

There are differing opinions in the market on whether the U.S. Federal Reserve Board (Fed) may raise interest rates over the coming months. Some participants read recent hawkish comments from Fed Chair Kevin Warsh as a signal, while others view the hawkishness as inevitable given the need to demonstrate independence from a U.S. administration that has been pushing for lower interest rates. In the sub-advisor’s view, the outlook for the Fed is therefore unclear.

There is more consensus in Canada, where the weaker economy has begun to show some stabilization despite falling into a technical recession. In the sub-advisor’s view, the April bounce is a correction rather than a recovery. The labour market is soft, business investment keeps falling on tariff and Canada-United States-Mexico Agreement uncertainty, the mortgage reset cycle grinds on and core inflation gives the BoC room to ease monetary policy. The sub-advisor believes the BoC could cut it policy interest rate before year-end, likely by 25 basis points.

Disclaimer

The commentaries on the company specific information and purchases and sales were provided by the fund manager. Canada Life Investment Management Ltd. will not be liable for any loss, or damages whatsoever, whether directly or indirectly incurred, arising out of the use or misuse of errors or omissions in any information contained in this commentary. The data provided in this commentary is for information purposes only and, except where otherwise indicated, is current as of June 30, 2026.

The views expressed in this commentary are those of fund manager as at the date of publication and are subject to change without notice. This commentary is presented only as a general source of information and is not intended as a solicitation to buy or sell specific investments, nor is it intended to provide tax or legal advice. Prospective investors should review the offering documents relating to any investment carefully before making an investment decision and should ask their Advisor for advice based on their specific circumstances.

The content of this commentary (including facts, views, opinions, recommendations, descriptions of or references to, products or securities) is not to be used or construed as investment advice, as an offer to sell or the solicitation of an offer to buy, or an endorsement, recommendation or sponsorship of any entity or security cited. Although we endeavour to ensure its accuracy and completeness, we assume no responsibility for any reliance upon it.

This document may contain forward-looking information which reflect our or third-party current expectations or forecasts of future events. Forward-looking information is inherently subject to, among other things, risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed herein. These risks, uncertainties and assumptions include, without limitation, general economic, political and market factors, interest and foreign exchange rates, the volatility of equity and capital markets, business competition, technological change, changes in government regulations, changes in tax laws, unexpected judicial or regulatory proceedings and catastrophic events. Please consider these and other factors carefully and not place undue reliance on forward-looking information. The forward-looking information contained herein is current only as of June 30, 2026. There should be no expectation that such information will in all circumstances be updated, supplemented or revised whether as a result of new information, changing circumstances, future events or otherwise.

There can be no assurance that the Fund’s return or volatility targets will be met, or met over any particular time horizon. Targeted returns and volatility should be evaluated over the time period indicated and not over shorter periods. Targeted returns are not actual performance and should not be relied upon as an indication of actual or future performance.

Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently, and past performance may not be repeated.

Counsel Portfolios are managed by Canada Life Investment Management Ltd. Counsel Portfolios are distributed by Quadrus Investment Services Ltd., IPC Investment Corporation, and IPC Securities Corporation, and may also be available through other authorized dealers in Canada.