Week Ahead: High risk events everywhere

It’s one of those weeks which you look at on the calendar some time before and view it with a mixture of excitement and slight unease, and it is Halloween after all. Major central bank meetings including the Fed, ECB and BoJ will coincide with several of the biggest companies on the planet reporting their earnings, amid a complex geopolitical environment which includes President Trump meeting with Chinese counterpart President Xi. Meanwhile, US stocks markets continue in the only direction they know, while gold bugs experienced their first down week in nine, as market commentators continue to cogitate about the modern-day gold rush that we have witnessed this year.

Of course, we can’t forget that the US government is still shutdown, which means there has been a dearth of any important economic data for policymakers to use. In any event, the FOMC is fully expected cut rates by 25bps on Wednesday, even though the latest Atlanta Fed Q3 GDP estimates sit at 3.9% on an annualised basis. ‘Letting the economy run hot’ could be this year’s phrase for US economic policy amongst many, but it’s still tough to square this kind of strength with major job market weakness. Perhaps rates are not really that restrictive on the economy after all and really the terminal or neutral rate should be higher still. The ECB meeting should be a nothingburger event in truth, with nothing to change its phrase of the year – that policy is ‘in a good place’.

Stocks continue higher with news over the weekend that US and China trade negotiators have agreed ‘a very positive framework’ to extend the trade war ceasefire likely to buoy sentiment. There are increasing questions over the AI drivers and the circular financing fly wheel between the tech giants that is driving this risk rally. We have heard it called an ‘AI hot potato’ and even a Ponzi scheme. Without AI-related spending, the US economy would be in recession. But this is a discussion for another time, as results from Microsoft, Alphabet, Meta, Amazon and Apple will keep us glued to our screens after the US markets close on Wednesday and Thursday. Trick or treat? As we have said a few times previously, stock seasonality and the Santa Claus rally is not far around the corner too.

In Brief: Major Data Releases of The Week

Wednesday, 29 October 2025

Magnificent Seven earnings: Five of the tech megacaps report after the US close this week, with Microsoft, Alphabet and Meta on Wednesday, and Amazon and Apple on Thursday. These stocks account for roughly 25% of the S&P 500.

FOMC Meeting: The Fed is expected to cut rates 25bps to 3.75–4.00%, as it balances softer labour data and elevated inflation. Markets eye signals on future cuts and balance sheet policy, with Powell’s tone key for shaping expectations on how aggressive 2026 easing could be.

The Bank of Canada Meeting: The BoC is likely to cut rates 25bps to 2.25%, reflecting mixed data and renewed US trade tensions. Focus will be on Governor Macklem and the Monetary Policy Report for clues on whether more cuts are coming, with rates below the midpoint of the bank’s neutral range.

Australia CPI: September monthly inflation is forecast to tick one-tenth higher to 3.1% and third quarter CPI at 1.1%. Housing is key to underlying, core inflation data with several domestic economists seeing upside risks. This would impact the trimmed mean print which consensus predicts will come in at 0.8%.

Thursday, 30 October 2025

The Bank of Japan Meeting: The BoJ will likely hold rates at 0.50%, amid political changes and slowing wage growth. Recent data points to downside risks to the BoJ’s forecasts. But the economy has been resilient in the face of tariff headwinds.

The ECB Meeting: The ECB is set to hold at 2.00%, maintaining the ‘good place’ policy stance. No major changes are expected until December’s fresh update of economic projections. Any signals from Lagarde on future cuts or commentary on eurozone stability will be watched.

Friday, 31 October 2025

Eurozone CPI: Headline HICP is forecast to tick down two-tenths to 2% and core one-tenth lower to 2.3%. The underlying inflation picture remains relatively stable, which matches current ECB policy.

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