Carney proposes a Canada-EU alliance, his investment summit and U.S. Federal Reserve raises interest rates: Must-read business and investing stories for the week of Sept. 19

Getting caught up on a week that got away? Here’s your weekly digest of The Globe’s most essential business and investing stories, with insights and analysis on the biggest headlines, stock tips, personal finance strategies and more.

Carney makes case for deeper alliance between Canada and the EU

In a speech to the European Parliament in Strasbourg, France, this week, Prime Minister Mark Carney focused on deepening ties between Canada and the European Union to build up an alliance of capabilities and protect their sovereignty from the control of great powers. He suggested they must work together to build independent data and computing power, payment systems and defence industries and develop energy and critical mineral supplies.

His speech comes after a busy week. The first-ever Canada Investment Summit took place in Toronto and European Commission President Ursula von der Leyen called on Canada to become the first associate member of the EU.

While Carney did not directly name the United States in his speech, there was no doubt the country was top of mind for him. President Donald Trump warned on Wednesday evening that he might consider an attempt to grant Canada associate member status a “hostile act.”

U.S. Federal Reserve raises interest rates for first time since 2023

Speaking of the U.S., their Federal Reserve raised interest rates on Wednesday for the first time since 2023 in a bid to tamp down inflation. The policy-setting Federal Open Market Committee decided unanimously to raise its benchmark interest rate by a quarter of a percentage point to a range of 3.75 to 4 per cent. In a statement, it said the move would support a “timelier return” to the Fed’s 2-per-cent inflation target.

The move has drawn criticism from Trump, who implored the central bank to slash borrowing costs, but he stopped short of admonishing new Fed chair Kevin Warsh – unlike his frequent jabs at previous Fed chair Jerome Powell.

In a press conference on Wednesday, Warsh said that the strength of the U.S. economy and resilient labour market, inflation trends and geopolitical concerns – he did not mention war in the Middle East specifically – had supported the decision to raise rates.

Canadian investors ditched U.S. stocks at a record pace in July

Canadian investors unloaded a record level of U.S. stocks and investment funds in July. Canadians sold $31-billion worth of U.S. stocks and equity funds that month, according to Statistics Canada, the largest monthly net exodus from American markets ever.

But the latest drop follows a stretch of strong demand for U.S. stocks in Canada. During the first six months of the year, Canadian investors snapped up a combined $78.1-billion worth of U.S. equities, Statscan said. Jason Kirby takes a look at the numbers in the latest instalment of the Decoder series.

OpenAI agents used a University of Toronto tool to communicate with each other

A tool that the University of Toronto uses to make web links easier to share was repurposed by OpenAI artificial-intelligence agents to communicate with one another – apparently unbeknownst to their human creators.

The AI agents, which are designed to carry out instructions from humans, were using the link shortener tool to post links for themselves and other AI agents to access, according to researchers and a university spokesperson. This use of the tool does not appear to have been harmful. But it is one of many recent examples of unexpected behaviour by AI agents that have rankled researchers and led to calls for a slowdown in the pace of the technology’s development, Alexandra Posadzki reports.

The University of Toronto said in a statement that the incident was not a security breach. No data were compromised, and the university’s digital properties were not affected.

What to know about Carney’s major investment summit

Carney’s Canada Investment Summit in Toronto earlier this week was, by many accounts, a success.

The two-day summit attracted about 250 leading financial CEOs, senior executives and Canadian political leaders. They formed a dense cluster of financial firepower – about $120-trillion in assets between them – around Toronto’s Four Seasons hotel on Monday and Tuesday. Roughly 80 side events dotted the downtown core.

Time after time, CEOs with enormous influence over the global flow of capital told Canadian politicians and business leaders they were impressed, that Canada is sending the right, investor-friendly signals and that the country’s trajectory has caught their attention, James Bradshaw reports.

But they also bluntly reminded those Canadian leaders – on stage, in private, even in conversations with reporters – that what matters from now on is executing the plan. To prove its case, Canada has to deliver more investable deals and a less sluggish regulatory process.

Here is a running list of the major announcements that came out of this week’s summit, plus the ones on the periphery, including private investment into major Canadian airports and a productivity mega deduction for businesses.

Prepare for the week ahead with The Globe’s investing calendar.