Five Central Banks Face Inflation Test as Fed Seen Holding at 3.75%-4.00%
Updated
Updated · Forex Factory · Oct 25
Five Central Banks Face Inflation Test as Fed Seen Holding at 3.75%-4.00%
3 articles · Updated · Forex Factory · Oct 25
Summary
Five central bank decisions and the UK budget dominate the Oct. 25-31 calendar, with markets watching whether policymakers still see inflation as sticky enough to justify tighter policy.
Australia’s CPI opens the week as the last major inflation reading before the RBA’s November meeting, while traders expect rate hikes from the RBNZ and Bank of Canada after persistent price pressures and a higher inflation outlook.
The Fed is expected to hold at 3.75%-4.00% after September’s unanimous hike, shifting attention to any dissent favoring another increase and to Q3 GDP and core PCE data arriving immediately after the decision.
Europe and Japan are seen staying on hold, but the ECB’s message on whether higher borrowing costs are already restraining inflation and the BOJ’s updated outlook for future hikes could still move the euro and yen.
In Britain, elevated gilt yields raise the stakes for Chancellor Healey’s budget, where investors will judge whether the tax-and-spending mix supports fiscal credibility without adding to inflation pressure.