By Dow Jones Newswires staff

Below are the most important global events likely to affect FX and bond markets in the week starting Sept. 8.

U.S. inflation data in the coming week will be the next key data ahead of a Federal Reserve interest-rate decision on September 17. Investors anticipate that rate cuts will resume from this month, but the pace of reductions beyond that remains uncertain.

In Europe, a confidence vote in France due to disagreements over the budget awaits, followed by a rate decision by the European Central Bank later in the week.

In Asia, focus will be on key economic data from China. Japan’s revised GDP figures are expected to confirm a steady but modest expansion in the second quarter.

U.S.

The U.S. Federal Reserve is widely expected to cut interest rates later this month after this prospect was flagged by Chair Jerome Powell at the recent Jackson Hole Symposium and following recent data revealing a weakening U.S. jobs market.

The latest non-farm payrolls data showed slow jobs growth in August, leaving a September rate cut very probable.

“??The extremely weak NFP reading of 22,000 signals a substantial slowdown in job growth, reinforcing concerns about economic weakness,” said Mohammed Taha, financial analyst at MH Markets in a note. “This amplifies expectations for a dovish Fed, likely cutting rates significantly at the next meeting to stimulate the economy.”

Investors will now turn their attention to inflation data for August due on Thursday. Slowing price growth could cement expectations for a series of rate cuts following an anticipated move in September, while higher-than-expected inflation could cause markets to anticipate a more gradual pace of reductions.

Focus will center particularly on whether hefty U.S. tariffs on imports from around the globe are causing inflation to rise.

“As reciprocal tariffs finally took effect in early August, markets will be keen to see if the August data reflect any uptick in prices from higher tariffs,” HSBC economists said in a note.

Producer prices data for August on Wednesday will also be closely watched for any signs that pipeline inflationary pressures are gathering momentum due to tariffs.

Data on the economy will continue to be scrutinized and any signs of weakness could add to Fed rate-cut expectations. In that regard, the University of Michigan’s preliminary consumer survey for September, due on Friday, could be a useful up-to-date indicator of how consumer sentiment is holding up.

Markets currently fully price in the chance of a 25 basis point interest-rate cut in September and are pricing a cumulative 68 basis points of reduction by year-end, LSEG data show.

The Treasury will auction $58 billion in three-year notes on Tuesday, $39 billion in 10-year notes on Wednesday and $22 billion in 30-year bonds on Thursday.

Latin America

Mexico inflation data for the full month of August are due on Tuesday, followed by Brazil’s August inflation figures on Wednesday.

Decisions by central banks in Chile on Tuesday and Peru on Friday are expected to result in unchanged rates.

Eurozone

The French government’s confidence vote over the budget on Monday will be key for eurozone bond and currency markets, as well as Fitch Ratings’ review on France on Friday.

“In France, Monday’s confidence vote in the government could set the tone for market dynamics early in the week,” said Tickmill Group’s Patrick Munnelly in a note.

A rate decision by the European Central Bank on Thursday will also be closely watched. The ECB is all but certain to leave policy rates on hold, with the deposit rate at 2.00%, while only small revisions are expected in the quarterly staff forecasts. Still, investors will look for clues on the rate outlook for the coming months, particularly given risks to the economy from hefty U.S. trade tariffs.

German and French industrial production data for July will be due on Monday and Tuesday, respectively, followed by Spanish and French industrial production figures for the same month on Wednesday.

Final August inflation data will be released from Germany, France and Spain on Friday.

On Tuesday, the Netherlands will sell a January 2037-dated bond, Austria auctions a February 2035-dated bond and Germany will auction August 2031- and February 2035-dated green Bunds. On Wednesday, Germany will auction 2.5 billion euros in July 2040 and May 2041-dated Bunds, while Portugal will sell June 2035- and April 2042-dated bonds. On Thursday, Ireland and Italy will hold bond auctions.

U.K.

U.K. gross domestic product data for July will be the main focus of the week.

A solid reading would cement expectations that the Bank of England is unlikely to cut interest rates again during the coming months, while a weak reading could reignite prospects of another reduction this year.

“The second quarter ended on a high note with the [U.K.] economy expanding by 0.4% m/m in June. We suspect that the start of the third quarter will also see output rising, albeit at a slightly more modest pace of +0.1% month-on-month in July,” said Investec economist Ryan Djajasaputra in a note.

Industrial production and trade data for July will also be released on Friday. The BRC’s August retail sales monitor is due Tuesday, while the RICS house-price survey for August is due on Thursday.

The next Bank of England decision is due on September 18.

The U.K. plans to sell government bonds, or gilts, maturing in October 2043 on Tuesday. On Wednesday it is due to sell October 2031 gilts.

Scandinavia

Norwegian inflation data for August are released on Wednesday, followed by August inflation data for Sweden on Thursday. Swedish gross domestic product figures for July are released on Wednesday.

Sweden and Norway will hold bond auctions on Wednesday.

Turkey

Turkey’s central bank announces its policy decision on Thursday.

Markets see an 85% chance of a 200 basis-point interest-rate cut to 41.00%, LSEG data show. The central bank lowered rates by a larger-than-expected 300 basis points at its last meeting in July, marking its first rate reduction since March.

Inflation eased further, albeit less than forecast, to 33.0% in August. That “keeps the door open” to large rate cuts at Thursday’s meeting, Capital Economics economist William Jackson said in a note.

However, with inflation still very high and GDP growth strong in the second quarter, the pace of easing will probably slow, he said.

Japan

Revised government data due Monday is expected to confirm that the Japanese economy grew modestly in the April-June quarter at a pace that almost matches initial estimates.

The Ministry of Finance is scheduled to auction 2.4 trillion yen worth of five-year Japanese government bonds on Wednesday, as well as sell six-month Treasury discount bills on Tuesday and three-month bills on Friday.

The Bank of Japan will also step in with operations to buy government bonds across maturities, from one year to longer than 25 years, as policymakers continue to guide yields and ensure market stability.

China

Exports data for August kicks China’s economic calendar off on Monday, as markets watch how shipments are weathering the tariff storm.

A poll of economists by The Wall Street Journal sees continued export resilience in the August print, albeit at a weaker pace of growth. Outbound shipments likely rose 5.2% on year last month, moderating from July’s 7.2% increase. Import growth is tipped to have slowed to 1.8% from 4.1% in July, potentially signaling soft demand. That would put the trade surplus at $101.4 billion.

HSBC economists cite trade restructuring and another tariff truce with the U.S. as tailwinds for Chinese exports, while duties may continue to weigh on growth.

On Wednesday, eyes turn to inflation data that will either soothe or confirm deflation fears.

Food and energy likely remained the main drag on consumer inflation in August, HSBC economists said, citing declines in pork and crude oil prices. Factory-gate prices likely extended a long stretch of contraction, though government efforts to clamp down on overcapacity could ease the decline somewhat.

A WSJ poll forecasts a return to negative territory for the headline consumer price index in August at -0.2% and a narrowed contraction for PPI of -2.8%.

Australia

Australia faces a relatively quiet week with no major data releases or central bank decisions.

The highlight for economists is likely to be ?W?estpac’s consumer sentiment survey, ?which last month rose ?by 5.7% to 98.5, marking the strongest reading in more than three years. Economists foresee the September update finally ?bringing an end to a long run of pessimism.

Westpac noted that it has been 42 months since Australian consumers last registered a net positive sentiment read. GDP growth for the June quarter was stronger than expected, fueling optimism that the economy has turned a corner.

“While often a double-edged sword for sentiment, signs of strengthening dwelling price growth may also be taken as positive evidence that interest rate cuts are working to lift activity,” Westpac said.

New Zealand

The Economic Survey of Manufacturing, along with wholesale trade and business financial data released at the same time, are the final partial indicators for second-quarter GDP, according to ANZ. The data are due for release on Tuesday and ANZ is expecting a weak reading for manufacturing.

“Some payback is likely after a robust increase in manufacturing in 1Q,” it said. “However, the volume of manufacturing is volatile on a quarter-to-quarter basis.”

There’s also a snapshot of consumer spending on Friday, with Westpac anticipating an increase in retail card spending by 0.3% in August following an increase of 0.2% in July?. Continued increases in food prices will again be a key factor underpinning the increase in spending, it said.

Discretionary spending, in contrast, is likely to be modest.

India

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09-07-25 2014ET