We finally get some US data this week (!) in the form of important consumer price inflation figures, which will dictate price action amid several other market drivers which have been seen recently. The big one has been tariffs, the trade war and rising tensions between the US and China which are bubbling, with the leaders of the two biggest world economies still set to meet in a few weeks. Investors believe the 100% levy threat is exactly that, with TACO still in play due to the fact that economists reckon the average US tariff rate would jump to above 30% if President Trump followed through.

Obviously, this is unsustainable and would be greater than even the Liberation Day tariffs originally announced in April. That said, we still saw stocks fall sharply, while yields and the dollar slid too as markets baked in more concrete policy easing, with even the small chance of a bumper 50bps rate cut at one of the two remaining FOMC meetings this year. Credit concerns around regional US banks also linger, but it’s notable that stocks closed last week in the green. Focus will turn to Tesla’s earnings published after the US close on Wednesday, among the 86 S&P 500 firms listed to release results this week. Those from Netflix, GM, GE, Ford and Intel will also grab headlines.

The dollar did soften on the week, and a 0.3% m/m core US CPI print for a third consecutive month shouldn’t see much change in this picture, though risks are skewed to the upside. That said, the bar for Fed skipping its planned rate cut on 29 October is very high. US PMI data could also catch more attention than usual owing to the lack of data in recent weeks. US economic releases will probably continue to be scarce, with prediction markets assigning roughly an 80% probability that the shutdown will extend into November.

In Brief: major data releases of the week

Monday, 20 October 2025

– China data: GDP is expected to have slowed to 4.7% from 5.2%. Cooler data is also forecast in retail sales at 2.9% from 3.4%, industrial production at 5% from 5.2% and fixed asset investment growth. The property sector remains fragile while resilient exports and ongoing fiscal support have offset tariff headwinds.

Tuesday, 21 October 2025

– Canada CPI: Headline inflation remains within the Bank of Canada’s target at 1.9%. But its preferred measure is at the higher end at 2.9%. The is the final CPI data before the BoC meeting at the end of the month, which has around 16bps of rate cuts priced in.  

Wednesday, 22 October 2025

– UK CPI: September headline inflation is expected to tick up two-tenths to 4%, which would be the highest print since January 2024. Services inflation is forecast to rise close to 5%, highlighting the persistent nature of UK price pressures.

Friday, 24 October 2025

– Japan CPI: September headline inflation is expected around 2.9% and the core above 3%. Government subsidies have helped cool prices. There’s around a one in five chance of an October BoJ rate hike. 

– EZ and UK PMIs: The euro area economy is set to be close to stagnant in H2 of 2025 which means a composite figure just above 50. The UK is likely to print similar with a muted service print due to budget uncertainty. 

– US CPI: The delayed inflation data is forecast to show the headline print remaining at 0.4% m/m, and the core at 0.3% m/m and 3.1% y/y. Goods inflation is seen rising due to the delayed impact from tariffs, but softer shelter costs are expected to offset this.