US CPI and Beige Book: the macro data driving markets today

U.S. CPI: the macro data moving the market most today: U.S. CPI and Beige

U.S. CPI and Beige: updated analysis with context for investors.

The absolute focus today is U.S. CPI: it comes out at 14:30 Madrid (7:30 Mexico City) and could redefine rates, the dollar, bonds, and the tone of the entire session.

U.S. CPI

September CPI is scheduled for 14:30 Madrid (7:30 Mexico City). The consensus points to monthly CPI of 0.6% and annual CPI of 3.6%; core monthly CPI of 0.2% and annual core CPI of 2.5%. Official Consumer Price Index calendar.

Analysis. This is the data point moving the most money today. If it comes in above consensus, yields rise, the dollar strengthens, and technology, small caps, and consumer stocks suffer. If it cools, Nasdaq and Europe will breathe easier. The key is not just the headline: watch the monthly core reading, because that is where the Fed’s real assessment is at stake.

Fed Beige Book

The Beige Book is released today at 20:00 Madrid (13:00 Mexico City). The Federal Reserve has scheduled it for this October 14 and it will be used to gauge activity, employment, and price pressures across districts.

Analysis. It does not usually move markets more than CPI, but it could finish off the session if it confirms a strong economy with sticky inflation. That combination supports a hawkish bias and puts pressure on equities via bonds. If it describes a clean slowdown, it could help indexes by reducing fears of further monetary tightening.

Lagarde speech

Christine Lagarde spoke today at 10:30 Madrid (3:30 Mexico City). The macro calendar also includes another speech at 16:30 Madrid (9:30 Mexico City), still relevant for the euro, banks, and European debt.

Analysis. Today the ECB matters less than U.S. CPI, but any tough tone on inflation or rates can weigh on the euro and European banks. If she sticks to caution and data dependence, the impact should be limited. For the IBEX, what matters most remains how banks and peripheral debt react.

China inflation

China reported today at 03:30 Madrid (20:30 Mexico City, Tuesday) its September CPI: 0.9% year-on-year, versus 1.0% expected and 0.8% previously. PPI came in at 5.0%, above the 4.4% expected and the 3.8% prior reading.

Analysis. A mixed but useful signal: weak consumption and stronger price pressure in production. That does not fully help dispel fears of a global slowdown with costs still elevated. In European equities, the effect is felt in miners, luxury goods, industrials, and overall opening sentiment. If China does not accelerate demand, the cyclical boost remains weak.

China money supply and credit

China reported today at 11:00 Madrid (4:00 Mexico City) M2 money supply growth of 7.2%, below the 7.4% forecast and 7.5% previous reading. New loans reached 1.080T, above the 1.025T expected and far above the prior 60B, according to Forex Factory.

Analysis. Here is the useful takeaway: credit is improving, but aggregate liquidity is losing some momentum. For the market, that leaves an uncomfortable conclusion: more targeted support, but no clear evidence of a powerful reacceleration. It may support commodities and cyclicals somewhat, although the real driver today will still be the U.S. inflation reading.

This article is general financial information and does not constitute an investment recommendation.

Keep reading on the blog: Today’s macro data: German CPI and the Fed agenda take center stage in the market and A practical step-by-step guide to investing better.