Rising oil prices will likely dominate financial markets’ attention next week as crude prices inched ever closer to US$50 a barrel. Investors will also be keeping an eye on Canadian bank earnings.

U.S. light crude for September delivery closed down US84¢ to US$47.86 a barrel in Friday trading on the New York Mercantile Exchange, after crossing the US$49 a barrel mark earlier in the session to reach an intraday high of US $49.40 for the first time.

However, while investors worry about the impact of rising prices, Avery Shenfeld, senior economist at CIBC Work Markets notes that “there is still a fair bit of slack in the North American economy. As a result of that slack, non-energy inflation is very tame and likely to remain so.”

He says even if crude hits $US60 a barrel, “the severe consequences of past oil shocks can be avoided.”

In Canada, the economic calendar kicks off Monday with retail trade figures for June. Economists forecast sales to slip by 0.1% as new vehicle sales continue to falter.

Also on Monday, Bank of Canada deputy governor David Longworth addresses the Canadian Association of Business Economics in Kingston, Ont.

The week’s biggest report – the consumer price index for July — comes on Tuesday. Economists expect the CPI to rise only 0.1% month-to-month as oil prices retreated during July.

The 12-month inflation rate is expected to hold steady at 2.5%. Core-inflation is expected to increase only modestly to 1.9%, up from 1.7% in June.

On Wednesday, Statistics Canada will release the composite index of leading indicators for July.

Thursday and Friday are quiet.

South of the border, oil will likely remain the dominant story, but there are a few pieces of economic news for traders to pick over.

With no economic releases scheduled for Monday, the calendar kicks of Tuesday with existing home sales for July and the Conference Board’s consumer confidence index for August.

Wednesday brings, the week’s key report, durable goods orders for July, as well as new home sales for July. Economists expect durable goods orders to post a 1.0% gain.

U.S. initial jobless claims are on the schedule for Thursday.

Real gross domestic product for the second quarter gets released Friday. Economists are forecasting a 2.7% gain.

Also on Friday, the University of Michigan releases its consumer sentiment index for August.

Canada’s major banks begin reporting third-quarter earnings this week.

Bank of Montreal kicks off the parade Tuesday followed by CIBC on Wednesday. Toronto-Dominion Bank, National Bank of Canada, and Laurentian Bank release their results on Thursday.

Royal Bank reports on Friday, and Bank of Nova Scotia releases its results next Tuesday.

For BMO, analysts expect a per share profit of $1.03 compared with 99¢ a year ago.

Analysts forecast CIBC to report a profit of $1.30 per share, compared with 97¢ per share last year.

For TD, analysts forecast a profit of 88¢ a share, up for 81¢ a year ago.

Laurentian profit is expected to rise to 40¢ a share, up from 29¢ last year.

For National Bank, analysts expect a profit of 95¢ a share, compared with 87¢ last year.

RBC profit is expected to climb to $1.21 a share, up from $1.17 last year.