Markets will closely watch the evolving balance between potential diplomatic breakthroughs and the risk of further escalation in strikes involving the US, Iran, and GCC states, especially as elevated energy prices and resilient global growth push bond yields to multi-decade highs. In the US, a busy data calendar features the September employment report, with the FOMC largely agreeing that the labor market is operating at or near full employment. Additional releases include ISM PMIs, personal income and spending figures, and the PCE price indexes.
In the Eurozone, and across its major member states, upcoming inflation and unemployment data will be assessed against market expectations for multiple ECB rate hikes over the course of this cycle. In China, a holiday-shortened week will still bring key PMI readings. Japan is set to publish industrial production and retail sales data, as well as the Bank of Japan’s quarterly Tankan survey. Trade figures from South Korea may offer new momentum for the AI-related trade. Finally, the Reserve Bank of Australia will announce its latest interest rate decision.