Insights 
VT 
The upcoming week features key economic events, including the US CPI, ECB rate decision, and Japanese GDP figures. Japanese GDP figures for Q2 are expected to stay at 0.3%, driven by business investment and exports. German industrial output for July and Chinese trade balance for August are also anticipated.
UN General Assembly And Apple
The UN General Assembly will likely focus on Iran’s nuclear programme and may address issues regarding Palestine. An Apple event is set to unveil new products and possibly increase iPhone prices. The US BLS may release preliminary employment data revisions. Chinese inflation data is due on Wednesday, with July’s data showing flat growth. Norwegian CPI is predicted to remain stable at 3.1%.
On Thursday, the ECB is expected to maintain rates, with attention on macro projections. The CBRT anticipates a 200bps rate cut following recent inflation data. US CPI is forecasted to rise by 0.3% in both headline and core figures for August. On Friday, UK GDP growth for July is predicted at 0.1%. OPEC’s Sunday meeting may discuss an oil production hike, moving away from previous expectations to maintain cuts.
We are looking at a week dominated by inflation data and central bank decisions, which will inject volatility into interest rate and equity index markets. The upcoming OPEC-8 meeting on Sunday is a major wildcard for energy prices. If they signal an increase in production, we should anticipate a downward move in crude oil, a significant shift from the policy of extending cuts we saw them commit to back in mid-2024.
Focus On Inflation And Jobs
The focus in the US will be on inflation and jobs data. Thursday’s CPI is expected to come in at +0.3%, a level of monthly inflation that has kept the Federal Reserve cautious for over a year. More importantly, Tuesday’s preliminary benchmark revisions to employment data could show significantly fewer jobs were created than first thought, potentially complicating the Fed’s policy path and creating chop in S&P 500 options.
In Europe, the ECB is expected to hold its deposit rate steady at 2.0% on Thursday. The real action will be in the press conference, especially with the political uncertainty brewing in France. We remember the French-German bond spread widening dramatically during the snap election turmoil in June 2024, so any instability from Monday’s no-confidence vote could make options on the CAC 40 index particularly active.
Tuesday’s Apple event is another key focus, with implied volatility on the stock already elevated. Given the expectation for price hikes and limited surprises, a “sell the news” reaction is a distinct possibility, a pattern we’ve seen after previous iPhone launches. We should watch for opportunities in short-dated put options to trade a potential post-announcement dip.
Data out of China on Monday and Wednesday is likely to confirm the economic softness we have been monitoring. Continued weak export growth and muted inflation, similar to the deflationary pressures seen throughout 2024, suggests ongoing headwinds. This could put pressure on commodity-linked currencies like the Australian dollar and industrial metals.
