The economic calendar for this week is packed with crucial data, with markets keenly awaiting inflation figures from the United States and the United Kingdom, alongside a host of other significant releases that could sway monetary policies and market dynamics.
In the United States, inflation has been a central concern for policymakers and investors alike. The year-on-year inflation rate remained unchanged at 3.7% through September, while the core measure, which excludes volatile food and energy prices, eased to 4.1%. Forecasts for October suggest a further cooling of inflation to 3.3%, with the core measure expected to dip to 4.0%. Comments from Federal Reserve Chair Jerome Powell regarding possible policy tightening have already impacted the US dollar, bond yields, and major equity indices. The upcoming inflation data is particularly critical; deviations from expectations might trigger a shift in rate hike forecasts.
The UK is also set to release its Consumer Price Index (CPI) inflation data. Analysts predict a deceleration in the year-on-year inflation rate to 4.8% in October, down from 6.7% in September, largely due to base effects from utility prices. Similarly, core inflation is projected to slow from September's 6.1% to 5.8%. These figures come after the Bank of England's decision to hold the Bank Rate steady at 5.25%, marking the second consecutive meeting without a rate change.
Beyond these key inflation reports, the week is filled with additional tier-1 data releases that are expected to influence markets across different regions:
- The UK will provide insights into its labor market with employment and wages data.
- Germany's ZEW Economic Sentiment Index will offer a glimpse into the economic outlook within European markets.
- Australia's Wage Price Index could have implications for the US dollar and bond yields.
- Inflation will remain a topic with the release of US Producer Price Index (PPI) data.
- US Retail Sales figures are on tap, providing a snapshot of consumer spending.
- The New York Empire State Manufacturing Index will reflect manufacturing conditions in the United States.
- Australia's Employment Data will shed light on job market health down under.
- China's Industrial Production and Retail Sales reports are set to affect global markets.
- The United States will also disclose its Weekly Unemployment Claims, Philadelphia Fed Manufacturing Index, and Industrial Production Data, painting a broader picture of the American economy's health.
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