<\/p>\n
A shopper at a clothing store in downtown Detroit, Michigan.<\/p>\n
(Bloomberg) — The Federal Reserve\u2019s preferred gauge of underlying inflation likely grew at a slower pace last month, offering policymakers some breathing room to address weakness in the US labor market.<\/p>\n
Most Read from Bloomberg<\/p>\n
A report on Friday is forecast to show the personal consumption expenditures price index excluding food and energy rose 0.2% in August, compared with 0.3% in July. On an annual basis, the so-called core measure is seen holding at a still-elevated 2.9%.<\/p>\n
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Fed Chair Jerome Powell pointed to a cooling labor market to explain why officials lowered interest rates on Wednesday for the first time this year, but he made clear that the central bank remains vigilant on inflation as President Donald Trump\u2019s tariffs continue to work through the economy.<\/p>\n
\u201cIt\u2019s challenging to know what to do,\u201d Powell said. \u201cThere are no risk-free paths now.\u201d<\/p>\n<\/p>\n
Several Fed officials are set to speak at public events in the coming week, including Powell on Tuesday in Rhode Island. New Fed Governor Stephen Miran \u2014 on a temporary leave from his role as chair of the White House Council of Economic Advisers \u2014 as well as Michelle Bowman, Mary Daly and Alberto Musalem are scheduled to offer their thoughts on the economy.<\/p>\n
Along with the August price data, Friday\u2019s report is projected to show inflation-adjusted consumer spending rose at a more subdued pace last month. Economists will also look at the personal income data to gauge the ability of consumers to continue spending \u2014 a key driver of US growth.<\/p>\n
What Bloomberg Economics Says:<\/p>\n
\u201cWe see signs that the economy is early in the recovery phase \u2014 and we agree with the direction of the median FOMC participant\u2019s growth and unemployment revisions. One piece of supporting evidence will come from August spending data, which should show consumers are spending briskly even as income growth has been tepid.\u201d<\/p>\n
\u2014Anna Wong, Stuart Paul, Eliza Winger, Estelle Ou and Chris G. Collins, economists. For full analysis, click here<\/p>\n
Other data in the coming week will include an updated look at economic growth from the past several years. Separate reports will offer insights into the US merchandise trade deficit, weekly applications for unemployment benefits, and consumer confidence.<\/p>\n
Turning north, Canadian gross domestic product data by industry for July and a flash estimate for August will shed light on how the third quarter is shaping up after the US tariff war crushed Canada\u2019s exports and forced a 1.6% contraction from April through June.<\/p>\n
Bank of Canada Governor Tiff Macklem will speak in Saskatchewan about how trade upheaval is impacting inflation and rates. Statistics Canada will also release population estimates for the second quarter as Prime Minister Mark Carney\u2019s government tries to unwind a post-pandemic immigration spike that\u2019s squeezed the housing supply.<\/p>\n
Elsewhere, flash purchasing manager indexes in Asia and Europe will be in focus. Policymakers in Sweden, Switzerland and Hungary are expected to hold rates steady, while Mexico and Nigeria are set to cut.<\/p>\n
<\/p>\n
Click here for what happened in the past week, and below is our wrap of what\u2019s coming up in the global economy.<\/p>\n
Asia<\/p>\n
Asia\u2019s week begins with South Korea\u2019s 20-day trade figures, an early gauge of global demand and chip exports. China sets its loan prime rates the same day, with markets expecting no change.<\/p>\n
On Tuesday, PMIs from Australia and India will show whether momentum in services is holding up as manufacturing remains under strain. India\u2019s readings will be key given recent resilience in domestic demand.<\/p>\n
Singapore and Malaysia both publish inflation figures on Tuesday, while Australia issues its partial gauge of prices on Wednesday that will help shape expectations for the Reserve Bank\u2019s policy outlook.<\/p>\n
<\/p>\n
Japan comes into focus at midweek with PMIs, while retail sales will provide a check on household spending on Thursday, and Tokyo inflation the following day will be a key early signal for nationwide prices. It\u2019s also a critical input for the Bank of Japan as it debates policy normalization.<\/p>\n
Singapore publishes industrial production on Friday, and South Korea releases business and consumer sentiment surveys. New Zealand reports consumer confidence figures.<\/p>\n
China on Saturday reports August industrial profits, a test of whether corporate earnings are stabilizing after months of deflationary pressure. The release follows data that showed government spending increased at a slower rate for the second straight month in August. Waning fiscal support contributed to the two weakest months for the country\u2019s economy this year in July and August.<\/p>\n
Rounding out the calendar are Malaysia\u2019s inflation figures, along with reserve updates from Indonesia and Thailand, a budget balance report from the Philippines, and Pakistan\u2019s GDP data.<\/p>\n
Europe, Middle East, Africa<\/p>\n
Among several central bank decisions, the Riksbank outcome on Tuesday looks set to be an unusually close call, with analysts split over whether policymakers will hold their benchmark at 2% to parry a spike in inflation, or cut to 1.75% to give growth a boost. Investors will also focus on the bank\u2019s new forecasts for borrowing costs.<\/p>\n
The same day, Hungary\u2019s central bank is poised to keep its rate at a European Union-high of 6.5% for a 12th month, despite a currency rally that\u2019s helping reduce price pressures. And on Wednesday, Czech officials are also likely to leave rates unchanged as inflation risks return.<\/p>\n
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The Swiss National Bank\u2019s decision on Thursday will be its first on whether to return to the negative monetary policy it exited three years ago. Most economists reckon it\u2019ll avoid taking that step for now, given the adverse effects of such a move on pension funds and the financial system.<\/p>\n
The meeting will be particularly significant because it\u2019s also the first to be followed four weeks later by a publication summarizing the arguments made by officials during their discussion \u2014 a step toward the sort of minutes-style communication used by advanced-economy peers.<\/p>\n
Survey numbers take center stage in the euro zone. PMIs are due on Tuesday, and Germany\u2019s closely watched Ifo business sentiment gauge follows a day later.<\/p>\n
The European Central Bank\u2019s survey of consumer inflation expectations will be published on Friday. ECB officials speaking during the week include chief economist Philip Lane and Executive Board member Piero Cipollone.<\/p>\n
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France\u2019s ongoing political and fiscal crisis will keep investors focused. Consumer confidence numbers there on Thursday will be scrutinized, while Scope Ratings may issue an update on the country the following day.<\/p>\n
In the UK, aside from its own PMIs on Monday, Bank of England Governor Andrew Bailey, chief economist Huw Pill and policymaker Megan Greene are all making appearances.<\/p>\n
A number of monetary decisions are scheduled around the African continent:<\/p>\n
Nigeria on Tuesday is poised to deliver its first cut in borrowing costs since the pandemic as inflation cools, making it the last of Africa\u2019s four biggest economies to begin easing.<\/p>\n
On the same day, Lesotho, whose currency is pegged to South Africa\u2019s rand, will probably match the Reserve Bank\u2019s move from Sept. 18 and leave its key rate unchanged at 6.75%.<\/p>\n
Sierra Leone may reduce borrowing costs on Thursday as inflation continues to slow.<\/p>\n
Latin America<\/p>\n
Banco Central do Brasil on Tuesday rolls out the minutes of its Sept. 17 rate-setting meeting, at which policymakers voted unanimously to keep their key rate at 15% with inflation still well above the 3% target.<\/p>\n
Finance Minister Fernando Haddad had earlier sounded a slightly dovish tone, but the post-decision statement was decidedly hawkish.<\/p>\n
<\/p>\n
Fast forward to Thursday, the central bank will publish its quarterly monetary policy report, updating several economic forecasts including inflation and the output gap. Brazil\u2019s mid-month inflation report will likely see a jump back above 5%.<\/p>\n
Later Thursday in Mexico, most analysts expect Banxico to deliver a 10th consecutive rate cut \u2014 the bank\u2019s second-longest streak since 2008, exceeded only by the 11 straight reductions during 2019-20 \u2014 to 7.5%.<\/p>\n
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Latin America\u2019s No. 2 economy has shown a surprising level of resilience given the drag from US trade and tariff polices, and inflation \u2014 while above the 3% target \u2014 is within Banxico\u2019s tolerance range and running roughly in line with central bank\u2019s estimates.<\/p>\n
Mexico will also post retail sales and a GDP-proxy figure for July, in addition to mid-month inflation data.<\/p>\n
In Chile, minutes of the central bank\u2019s Sept. 9 meeting will likely underscore policymakers\u2019 concern with stubbornly elevated core inflation, boosting speculation that the bank will again hold at 4.75% in October.<\/p>\n
<\/p>\n
Argentina\u2019s July GDP-proxy data comes on the heels of downbeat June activity and second-quarter output reports that prompted numerous analysts to mark down their 2025 GDP forecasts. Activity in July may have declined for a third straight month.<\/p>\n
Scoping out the road ahead, Brazil and Mexico watchers will get the latest market readouts on inflation expectations and a variety of economic forecasts.<\/p>\n
–With assistance from Swati Pandey, Laura Dhillon Kane, Monique Vanek, Robert Jameson, Mark Evans, Piotr Skolimowski, Charlie Duxbury and Reade Pickert.<\/p>\n
Most Read from Bloomberg Businessweek<\/p>\n
\u00a92025 Bloomberg L.P.<\/p>\n","protected":false},"excerpt":{"rendered":"A shopper at a clothing store in downtown Detroit, Michigan. (Bloomberg) — The Federal Reserve\u2019s preferred gauge of…\n","protected":false},"author":2,"featured_media":157973,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[64,63,1071,99,9567,9566,21375,5305,105064,1073,171,68002,105063,105066,94790,105065],"class_list":{"0":"post-157972","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-markets","8":"tag-au","9":"tag-australia","10":"tag-bloomberg","11":"tag-business","12":"tag-central-bank","13":"tag-consumer-confidence","14":"tag-consumer-spending","15":"tag-global-economy","16":"tag-inflation-figures","17":"tag-jerome-powell","18":"tag-markets","19":"tag-personal-consumption-expenditures-price-index","20":"tag-personal-income-data","21":"tag-policymakers","22":"tag-the-federal-reserve","23":"tag-underlying-inflation"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/157972","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=157972"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/157972\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/157973"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=157972"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=157972"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=157972"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}