Energy price developments have resulted in a tick down in headline inflation, while core inflation remains at 2.4%. Overall, the inflation environment seems to remain very stable around the ECB's target for the moment
PEC+ is scheduled to meet this weekend, with the expectation that the group will agree on an output hike for December
The Reserve Bank of Australia is expected to hold rates steady. Other highlights of the week include key data on China, Japan, South Korea, Taiwan and the Philippines
China’s manufacturing purchasing managers’ index saw a broad-based decline in October, while the non-manufacturing PMI managed to edge back into expansionary territory. Industrial activity has held up well despite soft PMI data year-to-date. Even so, this steeper downturn may raise some concerns
Higher-than-expected Japanese inflation in October, together with improvements in production and retail sales, suggests growth is bottoming out toward quarter-end, while price pressures continue to intensify. The Bank of Japan may consider an earlier rate increase
The dollar enjoyed a second round of support yesterday as Powell's relatively hawkish press conference continued to resonate with data-starved markets. But the conditions for another big leg higher in USD aren't there, in our view. Meanwhile, Japan has intervened verbally to curb JPY volatility, and GBP is looking closely at Reeves' political position
Improving eurozone hard data and a stable ECB mean the EUR swap curve should steepen from here. The complexity of estimating Dutch pension reform flows doesn't help the case for a steeper 10s30s. In the US, Treasuries are trading heavily in post-FOMC, and look like they can attempt to continue to do so
Spain’s economy grew by 0.6% over the third quarter, following a robust second quarter, as external demand weakened. With signs of cooling in industrial activity and tourism, growth is expected to normalise over the coming quarters and into 2026
The US remains in a steady state along the coupon curve. But there’s a lot going on in the money markets pipes as repo tightness persists. As we head into the Federal Reserve meeting, the big call would be to maintain the MBS roll-off and replace it with buying of T-bills, while broadly ending quantitative tightening
We expect a 25bp Fed cut today, in line with pricing and consensus. In September, a similar setting from a pricing perspective prompted a sharp dollar rebound. Now, with positioning more balanced and inflation looking better, it’s harder to see the same reaction. We expect some CAD weakness as the Bank of Canada should also cut by 25bp today
To meet surging power demand, the US needs to leverage all sources of energy with a laser focus on efficiency, reliability and affordability, not least if it's going to win the AI race too
US consumer confidence dipped again and remains on par with where we were during the pandemic. Concerns about the potential for tariff-induced price rises, a rapidly cooling jobs market and uncertainties over wealth are all having an influence and point to subdued consumer spending growth over the coming months
Italy's October batch of confidence data marks an improvement in all monitored sectors but services. This is good news for Italian growth perspectives in the fourth quarter
EUR/USD has nudged through resistance at 1.1650 in quiet markets. The softer dollar has been the driver, although we wonder whether some compromise on the French budget is helping too.
The dollar is a little weaker across the board in quiet trading conditions. The yen is outperforming on some very mild verbal intervention from Japanese authorities - but hardly enough to drive a sustainable trend. In a market deprived of US data by the government shutdown, there may be more focus than usual on reports that Amazon plans to cut 30,000 jobs
The oil market continues to digest the potential impact of US sanctions on Russian oil producers. Meanwhile, the risk of sanctions continues to provide a boost to middle distillates
South Korean growth beat expectations amid robust domestic demand, boosted by cash handouts and strong asset markets. Yet a slowdown is expected in the fourth quarter as government support wanes and export challenges abound
A revision of the eurozone's long-term growth outlook would have a significant upward impact on euro swap rates. This is unlikely to happen overnight, but in our view should build gradually over time. In the US, it's a steady state along the coupon curve. But there’s lots going on in the pipes of the money markets as repo tightness persists
Upside inflation risks are receding while worries about the jobs market are mounting. The Federal Reserve is expected to respond with another 25bp interest rate cut on Wednesday, and could also bring QT to a conclusion