This week markets will navigate the latest complex geopolitical news amid a barrage of news including the latest US inflation data, with September CPI on Wednesday and PPI on Thursday, the final readings before the Fed’s October 28 meeting, alongside a broader US activity pulse from retail sales (Thursday) and industrial production (Friday). After Columbus Day today where US bond markets will be closed but equities open, Q3 US earnings season also gets properly under way tomorrow, led by the big US banks, while across the globe ASML (Wednesday) and TSMC (Thursday) should provide another useful read on the AI capex cycle. Elsewhere, China has September inflation and trade data on Wednesday, UK monthly GDP is due Thursday, and the IMF/World Bank meetings run through the week, with the IMF’s latest World Economic Outlook out tomorrow and a long list of central-bank speakers. Thursday we also get what may be a key speech from Warsh at the IMF when the Fed Chairman participates in a fireside chat with IMF managing director Kristalina Georgieva at the IMF Annual Meetings in Bangkok; a moderated Q&A is expected.
Going onto more detail on the week ahead, the main event is US CPI on Wednesday. Economists expect headline CPI to rise +0.6% MoM in September, up from +0.40% in August, largely because seasonally adjusted motor-fuel prices are expected to jump 9.6%. That would lift headline inflation to around 3.6% YoY from 3.4%. The core picture should be much softer: economists expect +0.2% MoM, down from +0.3%, still this will be enough to push the annual rate higher to 2.5% from 2.4%. Within core, DB economists expect goods prices to be unchanged, with lower used-car and medical-care commodity prices offset by firmer recreation and IT goods. On services, last month’s jump in wireless prices should
