Newsquawk Week Ahead in Focus 31st-4th September 2026

WEEK AHEAD

EZ CPI PRELIM (TUE): August preliminary CPI is expected to rise from the prior reading on both an M/M and Y/Y basis, with the headline seen increasing 0.4% (prev. 0.2%) and the Y/Y figure rising 3.2% (prev. 2.9%). However, the Core Y/Y metric is expected to remain steady at last month’s 2.5%. For reference, the harmonised metrics from both France and Spain accelerated in August. The increase in prices is likely to be attributed to continued strength in oil prices as the geopolitical situation remains tense. In addition, Dutch TTF prices have risen towards 3mth highs in recent weeks amid concerns over low gas storage levels. Given this, Credit Ag sees Energy HICP rising 15.2% Y/Y (prev. 10.2%). Elsewhere, Services is expected to remain at 3.3%. Concerns remain over the potential for second round effects, with little or no evidence materialising in the bloc. While unlikely to be evident in the August reading, this will be a focal point for ECB members. ECB’s Kazimir stated that the Bank should act before second-round effects are visible. Heading into the September meeting, money markets assign a 96% chance of a 25bps hike. Recent source reports have reinforced that view, with Bloomberg suggesting officials are ready to raise rates in September. Therefore, the August inflation report will likely have little immediate sway on policy but may influence views on rates later in the year, although the base case among analysts is that this will be the ECB’s final hike.

US ISM MANUFACTURING PMI (TUE): Analysts expect the ISM Manufacturing PMI headline to ease to 55.3 in August (vs 55.6 in July). As a proxy, S&P Global’s flash manufacturing PMI eased to 53.2 in August (from 53.9 in July), a five-month low, with the output index falling further to 51.9 (from 53.9), a 13-month low. Under the bonnet, production growth waned for a third successive month to its slowest pace since July last year, while new orders slipped to their weakest since March. Inventories were also a drag, with input buying weakening sharply, as the precautionary stock-building linked to the Middle East conflict that had driven earlier factory growth continued to fade. Supply chains remained a key support for the headline figure, with supplier delivery times lengthening by the thirdmost in four years, attributed to shipping delays, tariffs and diminished stock availability at suppliers. Input cost inflation moderated for a third straight month, and selling-price inflation eased to a six-month low, as cost pressures cooled. On jobs, factory payrolls rose modestly, but still the largest increase since May. Broader sentiment continued to improve, reflecting fuller order books and fading trade and geopolitical concerns, S&P said.

RBNZ POLICY ANNOUNCEMENT (WED): RBNZ is likely to increase rates in September, as a recent poll showed 27 out of 31 economists expect the RBNZ to raise the OCR by 25bps to 2.75%. Money markets are pricing around a 99% likelihood the central bank will deliver its second consecutive 25bps rate increase. As a reminder, the RBNZ raised interest rates for the first time in over three years at the last meeting in July, which was as expected and made by a consensus decision. It noted that a further reduction in monetary stimulus is likely to be required to return inflation to the 2% target mid-point, adding that the effects of the Middle East situation will linger for some time. It also stated that the outlook for medium-term inflation pressures remains uncertain and depends on the extent to which recent cost increases feed through into higher prices. There hasn’t been much fresh commentary from the central bank recently regarding monetary policy, although the data does support the case for a hike after hotter-than-expected inflation as CPI for Q2 Q/Q printed at 1.5% vs. Exp. 1.4% (Prev. 0.9%) and Y/Y at 4.1% vs. Exp. 4.0% (Prev. 3.1%), which is firmly above the central bank’s 1-3% medium-term target. Meanwhile, jobs data was mixed as Employment Change in Q2 topped forecasts at 0.5% vs. Exp. 0.1% (Prev. 0.2%), and the Unemployment Rate unexpectedly rose to 5.6% from 5.4%, although this was accompanied by a rise in the Participation Rate to 70.7% from 70.4%.

BOC POLICY ANNOUNCEMENT (WED): BoC is expected to keep rates unchanged at 2.25% in its meeting next Wednesday, according to all economists surveyed by Bloomberg and Reuters. On the trade footing, Canada’s proposed “dollar-for-dollar” retaliatory tariffs on the US after the collapse of trade negotiations will further dampen economic growth, and likely slightly increase consumer prices. Oxford Economics writes that this won’t cause a recession, but greater uncertainty about Canada-US trade policy will weigh on the economy. As such, OxEco, expects the mix of weaker growth, higher prices, and greater trade policy uncertainty to keep the BoC at 2.25% well into late 2027 and possibly into 2028. But, if the economy falters more than they expect and prevents businesses from passing these costs onto consumers, the BoC could temporarily cut the policy rate below 2% in the next 12 months.

AUSTRALIAN GDP (WED): Australian Q2 GDP is expected to rise 0.4% Q/Q (prev. 0.3%), while Westpac forecasts a softer 0.2% increase and 1.7% Y/Y growth. Westpac expects higher interest rates and the Middle East conflict to have weighed on activity, although investment in data centres, renewables and housing construction should provide some support. Focus will be on whether growth remains resilient following the recent hotter-than-expected inflation data, with an upside surprise likely to reinforce expectations for further RBA tightening.

SWISS CPI (THU): Swiss annual inflation is seen holding within a 0.4-0.5% range in September. As a reminder, the last report showed headline inflation declining to 0.4% Y/Y (prev. 0.5%), while Core remained steady at 0.3% Y/Y. The headline remained towards the lower end of the SNB’s 0-2% inflation target and therefore supports the consensus that the SNB will remain on hold for the foreseeable future. Another benign reading from the region will likely see policymakers deliver another hold at the September meeting. Policymaker Tschudin, commenting on broader inflation dynamics, explained that Swiss inflation is low because inflation expectations are low and oil has a small weight in Switzerland’s consumption basket. However, he reiterated the SNB’s warning that it remains ready to take interest rates below zero if necessary.

US ISM SERVICES PMI (THU): As a proxy, S&P Global’s flash services PMI business activity index jumped to 56.8 in August (from 54.6 in July), a 20-month high; S&P said the sector revived from the sluggish pace seen earlier in the year to register its fastest growth since December 2024. Under the bonnet, new business continued to show robust growth, with the trend improving vs the previous month, a contrast to the slowdown seen in manufacturing. Strong demand, combined with supply constraints, also pushed outstanding business higher, rising at the sharpest rate since May 2022. With regards to jobs, service providers reported the largest rise in hiring since the start of 2025, as firms grew more confident about the near-term outlook. Price pressures eased, with input cost inflation cooling vs July’s 14-month high, while prices charged for services rose at their slowest pace in ten months. Business confidence continued to improve, with expectations climbing to a nine-month high, reflecting fuller order books, rising customer enquiries and fading concerns over tariffs and the Middle East conflict. S&P said the service sector was now driving the broader US expansion, underscoring a growing dependency on consumer spending and financial services growth.

US JOBS REPORT (FRI): The US economy is expected to have added 45k nonfarm payrolls in August (vs -23k in July, vs 3-month average of 20k, vs six-month average of 44k, and vs a 12-month average of 26k); within that, private payrolls are seen rising 50k (prev. 30k). The unemployment rate is expected to rise to 4.2% (vs 4.1% in July). The FOMC’s June forecasts pencilled in unemployment rising to 4.3% this year (these forecasts will be updated in September), while the Chicago Fed’s real-time unemployment rate forecast for August was at 4.1%, little changed vs the official 4.1% in July; it noted stable layoffs and a small decrease in hiring, as measured by its Layoffs and Other Separations Rate, as well as its Hiring Rate for Unemployed Workers datasets. Average hourly earnings are seen rising by 0.2% M/M (prev. 0.1%). Weekly initial jobless claims for the payroll reference week rose to 207k vs the 189k heading into the July report, while continuing claims were little changed at 1.778mln (vs 1.777mln into the July data). Analysts at Barclays are below consensus, and expect a headline payrolls figure of 25k, which it says that barring any revisions, would put the 3-month movingaverage for job gains at 7k, around the breakeven pace. The bank sees private payrolls up by 25k, and government hiring to be broadly flat. However, it flags unusually elevated uncertainty; its claims-based models, which use weekly initial/continuing claims data, points to stronger gains, though alternative indicators it uses suggest a more modest outturn. Barclays forecast also incorporates the end-July cancellation of Temporary Protected Status for around 300K immigrants, of whom around 200K were estimated to be employed, and captured in July payrolls; the bank expects about 25K of these workers to drop out of the payroll count in August, with further losses likely in subsequent months. In terms of the policy implications, Fed officials have been more focussed on the inflation-side of its mandate, where price growth is running above target; the jobs market, however, has not been causing any major cause for concern. Barclays expects the Fed to remain attentive to the divergence between payroll and household survey signals, which should support a continued on-hold stance.

CANADIAN JOBS REPORT (FRI): The August jobs report will be scoured for any indication of whether the prior month’s labour market strength has continued. As a reminder, Canada added 75.1k jobs in July, well above the consensus of 12.5k. The unemployment rate fell to 6.4% (exp. 6.5%, prev. 6.5%). Over the past three months, Canada added 181k jobs, rebounding from the subdued theme seen towards the start of the year. While unlikely to affect the August report, the renewal of US-Canada trade tensions could dampen business confidence and negatively affect the region’s jobs market. Canadian economist Tombe opines that the latest tariff situation could result in job losses exceeding 90k over the longer term

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WEEK IN REVIEW

RBA MINUTES: RBA Minutes from the August meeting stated the board is ready to increase rates if upside risks materialise and several members judged it is possible upside risks to inflation would crystallise. Others saw offsetting downside risks and time to assess data. It was also stated that following the increases in the cash target earlier in the year, monetary policy appeared sufficiently restrictive to bring inflation back to target within a reasonable timeframe, and that there was still some time to assess the accuracy of that judgement. Members considered whether to raise the cash rate target by 25bps at the meeting or to leave it unchanged for the time being. Furthermore, staff research findings implied that a more pre-emptive approach to monetary policy might be appropriate when the economy is subject to capacity constraints and adverse supply shocks, and members acknowledged that the global cost shock generated by the conflict in the Middle East meant some spare capacity may be necessary to bring inflation back to target.

AUSTRALIAN CPI REVIEW: Australian CPI rose 1.0% M/M in July (exp. 0.8%), while annual inflation eased to 3.5% from 3.8% due to base effects, but remained above expectations of 3.3%. Trimmed Mean inflation was also stronger than expected at 0.5% M/M (exp. 0.3%) and 3.6% Y/Y (exp. 3.5%), while domestic services inflation remained elevated, with upside pressure from fuel, domestic travel and household services. Westpac said the upside surprise should keep the RBA’s rhetoric hawkish, although softer labour and wage data means a November hike remains a risk rather than its base case.

US PCE REVIEW: Core PCE rose 0.2% M/M in July, in line with analyst expectations, while headline PCE rose 0.2%, above the 0.1% forecast. Core PCE rose 3.3% Y/Y, matching both the prior pace and analyst forecasts, while headline PCE rose 3.7% Y/Y, unchanged from the prior but above the 3.6% forecast. With the headline measures hotter than expected, the initial reaction was hawkish as the FOMC continues to face stubbornly elevated inflation. However, the data did not materially alter the policy outlook, with recent softness in the labour market allowing the Fed to remain patient rather than rushing into rate hikes. There is still more data due before the September FOMC to further shape expectations for the meeting, with markets currently assigning around a 62% probability of a hold. Elsewhere within the report, personal spending rose 0.2%, above the 0.1% forecast but slowing from the prior 0.3%, while personal income rose 0.4%, above both the 0.2% forecast and prior, pointing to continued resilience among consumers. On prices, Pantheon Macroeconomics noted that the core deflator was a whisker away from rounding to 0.3%, although the underlying details were relatively encouraging. The consultancy highlighted that around 11bps of the monthly core increase came from portfolio management prices, a volatile component which it expects will largely be revised away following upcoming methodological changes. Pantheon expects further relatively reassuring monthly inflation prints to convince the FOMC to keep policy unchanged through the remainder of the year.

NVIDIA EARNINGS REVIEW: Nvidia shares initially slipped as much as 3% on its earnings release, after the tech-behemoth noted that its commitments have more than doubled due to memory procurement costs, and it sees Q3 margins fall below Q2 levels. Despite that, the earnings release was very strong as quarterly metrics impressed, as did data centre revenue, while next quarter revenue outlook beat. Heading into the earnings release, a beat and a raise was expected by the sell-side. However, shares ultimately finished extended up, and closed the next day with extensive gains, after execs forecast stronger-than-expected revenue growth in FY28, supported by broadening AI demand, accelerating adoption of its next-generation processors and expanded cloud partnerships, despite the ongoing supply constraints. Within that, Nvidia gave long-term guidance, more than just the current FY, for the first time and was exceedingly strong. Following earnings, the AI leader saw PT raises galore amid their strong outlook, long-term guidance, and increased transparency. Raymond James noted that results and FY28 outlook significantly exceeded expectations, with 70% projected growth, accelerating architectural demand, and robust capital returns driving optimism, while non-hyperscaler revenue is expected to outpace hyperscalers.

BOK POLICY ANNOUNCEMENT REVIEW: Bank of Korea hiked its base rate by 25bps to 3.00%, as expected, while the rate decision was not unanimous as Board Member Hwang dissented on the rate decision. BoK said inflation is projected to remain above the target level for a considerable time, and it will decide the timing and pace of further increases in the base rate. BoK Governor Shin said inflationary pressure looks like it is here to stay, and the back-to-back rate hike was necessary to pre-emptively respond, while they needed to act by raising interest rates before inflationary pressures grow further. In terms of board members’ forecasts, 5 of 21 policy rate projections by board members for the next six months are at 3.00%, 10 of 21 policy rate projections are at 3.25%, and 6 of 21 policy rate projections are at 3.50%.

ECB MINUTES REVIEW REVIEW: The Minutes from the July meeting unsurprisingly had a hawkish tilt, given recent commentary by ECB officials. The Minutes stated that July’s decision to keep rates unchanged was unanimous, with members judging that a pause was appropriate amid high uncertainty and the need to await more data on the inflationary impact of the conflict-driven energy shock. However, some members argued in favour of a rate hike, while all agreed that another hike would likely be necessary unless the inflation outlook improved significantly. Inflation risks remain tilted to the upside, with the Minutes noting that gas prices could be the next price shock and highlighting their impact during the 2022 inflation shock. All in all, the Minutes set the stage for a rate hike in September, with Nordea forecasting a hike followed by additional tightening in December and March 2027, while markets are fully pricing in a hike in September.

TOKYO CPI REVIEW: Tokyo CPI rose 1.9% Y/Y in August (exp. 1.9%, prev. 1.8%), while Core CPI accelerated to 1.8% (exp. 1.7%, prev. 1.7%) and “Super-Core” CPI rose to 2.0% (exp. 2.0%, prev. 1.8%). Desks said the data pointed to broadening underlying price pressures despite some relief from energy costs, with the stronger-than-expected core reading reinforcing expectations for further BoJ normalisation and keeping a September rate hike firmly in play.

WARSH REVIEW: Fed Chair Warsh’s Jackson Hole speech offered a little more than traders were anticipating; many had expected him to say little, given his bias against any forward guidance. Warsh’s message was heavily inflation focused: he noted 12-month PCE was at 3.7%, and the six-month rate at 4.1%, both above target, and he stressed that more than half of PCE components are still rising above 3%. He said that underlying inflation trends “have not meaningfully improved,” despite the better than expected prints over the summer months. He said the Fed has more work to do, unless progress towards its 2% inflation target resumes. He again put price stability ahead of the labour side of the mandate, judging labour markets consistent with full employment. On growth and economic conditions, Warsh said the economy was resilient and strengthening, and pointed to AI-driven capex as a growth driver, adding that he would be “hard pressed” to call financial conditions restrictive, citing easy credit spreads, looser bank lending standards and firm equity markets. And that combination gives the Fed little urgency to ease. As expected, however, there was no explicit forward guidance: July’s FOMC majority preferred to wait for more data before moving, and Warsh reiterated guidance should stay “limited and circumscribed.” Accordingly, there was no explicit signal for the September meeting. In wake of the speech’s release, money market pricing tilted more hawkishly, now assigning around a 50% probability of a rate hike at the September confab (vs around 36% prior to the release). It is also worth noting that Fed officials more broadly remain divided on the inflation outlook. This week, Kansas City Fed President Schmid (2028 voter) and Cleveland Fed President Hammack (2026 voter) argued current rates are not sufficiently restrictive and further tightening may be needed, while Boston Fed President Collins (2028 voter) described policy as mildly restrictive and Chicago Fed President Goolsbee (2027 voter) said he is waiting for evidence on whether the inflation shock will persist.

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