Fed Chair Kevin Warsh has said bluntly that inflation is the determining factor for his forecasts. The regulator leans toward keeping rates unchanged if price pressures continue to ease, but stands ready to support further tightening if inflation deceleration stalls. Financial markets have therefore focused squarely on the upcoming US inflation releases ahead of the Federal Open Market Committee (FOMC) meeting on September 15–16. For now, markets are tilting toward a hawkish Fed decision after Friday's stronger-than-expected jobs report.
Geopolitics remains an additional source of uncertainty. On Monday, Iran threatened harsh retaliatory measures against any new US strikes on its assets, warning of the high vulnerability of the region's entire energy infrastructure — including facilities owned by US oil and gas firms. Risks of supply disruptions for oil and raw materials are feeding expectations of higher fuel prices, which could stoke consumer inflation and complicate the Fed's task.
According to the August Survey of Consumer Expectations by the Federal Reserve Bank of New York, median one-year inflation expectations remained at 3.6%, but notable increases were recorded within key categories. Expected price increases rose to:
Against this backdrop, the median wage growth forecast was 2.9%. And the probability of higher unemployment a year from now jumped to 44.4% — the highest level since April 2020.
Investment bank UBS has radically revised its outlook for US monetary policy in 2026. Whereas UBS analysts had previously expected the policy rate to remain unchanged through year-end, Reuters reports they now forecast a sequential increase. The outlook calls for two 25-basis-point hikes:
UBS Global Wealth Management cited stronger-than-expected US labor data for August, Fed Chair Kevin Warsh's hawkish rhetoric at the Jackson Hole symposium, and growing supply-side inflation risks as the reasons for the abrupt pivot.
Goldman Sachs presented an alternative assessment ahead of the Fed meeting. Its analysts say the CPI inflation report will decide the Fed's fate. While they acknowledge that August Nonfarm Payrolls exceeded forecasts and prior months were revised upward, Goldman argues that labor statistics alone are not sufficient to trigger rate hikes.
The decisive factor will be the CPI release on Friday, September 11:
Meanwhile, futures markets have already shifted toward a hawkish stance. According to the CME FedWatch tool, the probability of a 25-basis-point hike in September has risen to 60.4%. Easing policy traditionally fuels capital inflows and increases risk appetite, while rate hikes and hawkish Fed commentary strengthen the dollar and prompt outflows from alternative assets.
September 9, 02:00 / Japan / Reuters Tankan (leading) index for September / prev.: 13 pts / actual: 18 pts / forecast: 15 pts / USD/JPY — up The sentiment index for large Japanese manufacturers rose to its highest level since early spring. August's improvement was driven by:
The automotive segment remained flat due to a mixed market situation. Analysts expect a moderate slowdown in September. Confirmation of that forecast would reflect business caution and could weaken the yen.
September 9, 04:30 / China / Consumer Price Index (CPI) for August / prev.: 1.0% / actual: 0.5% / forecast: 0.8% / Brent — up, USD/CNY — down
Year-on-year inflation in China slowed to a year-low in July, missing market expectations. Weak price dynamics were driven by:
Medical-service costs accelerated. In August, experts expect consumer inflation to pick up again. If the reading improves, the yuan would be supported, and USD/CNY would move lower.
September 9, 04:30 / China / Producer Price Index (PPI) for August / prev.: 4.1% / actual: 3.5% / forecast: 3.7% / Brent — up, USD/CNY — down
China's producer-price growth slowed in July to its weakest pace in recent months. The indicator was shaped by:
Markets expect industrial inflation to accelerate in August. A confirmed rebound in producer prices would support the yuan and oil prices.
September 9, 09:00 / Japan / Machinery orders (capital goods) for August / prev.: 52.8% / actual: 50.4% / forecast: 43.0% / USD/JPY — up
Japan's machinery-order volume showed a strong rise in July, keeping last month's robust pace. Demand was driven by:
Analysts forecast slower growth in orders in August. Confirmation of that cooling would weigh on the yen.
September 9, 15:15 / US / 4-week average change in private-sector employment / prev.: 9.5k / actual: 11.8k / forecast: — / USDX (6-currency USD index) — up
The four-week average of new private-sector jobs in the US rose, exceeding the prior period. The increase points to continued resilience in the corporate sector and gradual expansion of hiring. With no consensus forecast provided, focus shifts to subsequent releases. Continued strength in hiring would support the US dollar.
September 9, 23:30 / US / API weekly crude oil inventories / prev.: +4.2 mln bbl / actual: -2.6 mln bbl / forecast: — / Brent — up
US commercial crude stocks fell sharply, offsetting much of the previous week's build. The report noted:
With no official consensus forecast, attention turns to the next release. Continued inventory draws would support Brent prices.
September 10, 02:01 / UK / RICS house-price balance for August / prev.: -32% / actual: -30% / forecast: -28% / GBP/USD — up
UK house-price sentiment showed a modest improvement in July but remained negative. The market was characterized by:
Analysts expect a slight easing of the pace of price declines in August. Confirmation would signal gradual stabilization and support the pound.
September 10, 04:00 / Australia / Consumer inflation expectations for September (leading) / prev.: 4.7% / actual: 4.9% / forecast: 5.1% / AUD/USD — up
Australian consumer inflation expectations resumed rising after a July dip. Drivers included:
Analysts expect inflation expectations to continue rising in September. That would justify a hawkish RBA stance and push the Australian dollar higher.
September 10, 09:00 / Germany / Consumer Price Index (CPI) final for August / prev.: 2.3% / actual: 2.8% / forecast: 2.9% / EUR/USD — up
Annual inflation in Germany accelerated to its highest level since mid-spring. Main contributors were:
Markets expect further upside in August inflation readings. Continued inflationary pressure would push the ECB toward tighter policy and support the euro.
September 10, 15:15 / Eurozone / ECB interest rate decision; 15:45 / press conference /prev.: 2.40% / actual: 2.40% / forecast: 2.65% / EUR/USD — up
At its July 23 meeting, the European Central Bank kept its policy rate unchanged at 2.40%. The decision reflected:
The outcome was below forecasts that had priced in a hike. A move by the ECB toward tightening would support the euro.
September 10, 15:30 / US / Initial jobless claims / prev.: 204k / actual: 206k / forecast 205k / USDX — up
New unemployment-benefit claims in the US showed a slight increase in the fourth week of August, remaining near low levels. Labor conditions were characterized by:
Looking ahead, markets anticipate a slight decline in the number of claims. Confirmation of stability in the labor sector would create conditions for the US dollar to strengthen.
September 10, 15:30 / US / Producer Price Index (PPI) for August / prev.: 5.5% / actual: 4.7% / forecast: 5.3% / USDX — up
US producer price growth slowed in July to its weakest pace since early spring. The dynamics reflected:
Markets expect an acceleration in industrial inflation in August. If realized, that would give the dollar additional upside.
September 10, 17:00 / US / Existing home sales for August / prev.: 4.13 mln / actual: 4.06 mln / forecast: 3.99 mln / USDX — down
Existing-home sales in the US continued to decline in July, falling to 4.05 mln. The housing market was marked by:
Analysts expect further declines in August sales. Cooling in housing could weigh on the dollar.
September 10, 19:00 / US / EIA weekly crude oil inventories / prev.: +0.095 mln / actual: -4.45 mln / forecast: 7.559 mln / Brent — down
US commercial crude stocks fell sharply in the last week of August, interrupting a four-week build. The report showed:
Markets expect inventories to resume strong builds in the next report. If confirmed, pressure on Brent would increase.
September 11, 02:50 / Japan / Business Sentiment Index (BSI) for large manufacturers, Q3 / prev.: 3.8% / actual: -1.8% / forecast: 2.5% / USD/JPY — down
Business sentiment among large Japanese manufacturers unexpectedly turned negative in Q2. The deterioration was driven by:
For Q3, analysts expect the indicator to return to positive territory. Confirmation would signal a recovery in industrial optimism and strengthen the yen, pushing USD/JPY down.
September 11, 02:50 / Japan / Producer Price Index (PPI) for August / prev.: 7.3% / actual: 7.2% / forecast: 7.4% / USD/JPY — down
Japan's industrial inflation eased slightly in July but remained near multi-year highs. PPI dynamics were influenced by:
Analysts expect PPI acceleration to resume in August. Stronger cost pressures would raise the probability of BOJ tightening and strengthen the yen, lowering USD/JPY.
September 11, 09:00 / UK / GDP growth for July / prev.: 1.2% / actual: 1.1% / forecast: 1.2% / GBP/USD — up
UK annual GDP growth for June exceeded expectations despite a mild slowdown. Activity was supported by:
Markets expect a recovery in expansion for July. If realized, the pound would gain.
September 11, 09:00 / UK / Construction output (leading) for July / prev.: -1.6% / actual: -2.0% / forecast: -2.3% / GBP/USD — down
UK construction output continued to decline in June, extending the series of falls. Factors included:
Analysts expect deeper contraction in July. Continued weakness would weigh on the pound.
September 11, 09:00 / UK / Industrial production for July / prev.: 1.0% / actual: -0.2% / forecast: 0.5% / GBP/USD — up
UK industrial production unexpectedly slipped below long-term averages in June. The decline reflected temporary cooling of output amid high energy costs. Analysts expect a rebound in July. Confirmation would support the pound.
September 11, 15:30 / US / Consumer Price Index (CPI) for August / prev.: 3.5% / actual: 3.4% / forecast: 3.4% / USDX — volatile
US year-on-year consumer inflation continued to decelerate in July, marking the second monthly slowdown. Drivers included:
Analysts expect restrained CPI growth in August. Cooling inflation would weaken the dollar.
September 11, 17:00 / US / University of Michigan consumer sentiment index for September (leading) / prev.: 55.2 pts / actual: 51.7 pts / forecast: 51.0 pts / USDX — down
US consumer sentiment fell in August and remains well below last year's levels. The decline was driven by:
Further erosion in household sentiment would weigh on the dollar.
Events & speakers to watch
September 9, 20:00 / Eurozone — Speech by ECB President Christine Lagarde / EUR/USD
September 9 — Speech by Joachim Nagel, ECB Governing Council member / EUR/USD
September 10, 04:30 / Japan — Speech by Kazuyuki Masu, BOJ Policy Board member / USD/JPY
September 10, 15:45 / Eurozone — Speech by ECB President Christine Lagarde / EUR/USD
September 11, 12:00 / France — IEA report on the oil market / Brent
September 11, 17:00 / Eurozone — Speech by ECB President Christine Lagarde / EUR/USD
September 11, 20:00 / Eurozone — Speech by Philip Lane, ECB Governing Council / EUR/USD
September 12, 11:00 / Eurozone — Speech by ECB President Christine Lagarde / EUR/USD
September 12–13 / New Delhi, India — 18th BRICS Summit (members include Brazil, China, Egypt, Ethiopia, India, Indonesia, Iran, Russia, South Africa, UAE)
Also expect remarks from major central?bank officials on these dates. Their comments often trigger FX volatility because they can signal future policy moves.
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