In the European session, we have several low tier releases on the agenda including the French Industrial Production, the Italian Retail Sales, the Eurozone PPI and the final services PMIs for the major Eurozone economies and the UK. None of the data is going to change anything for the respective central banks.
In the American session, we have the US ADP and the US ISM Services PMI. The ADP is expected at 28K vs -32K prior. This might be the only major US jobs report we get this month as the shutdown should have impaired the BLS collection of October data as well, so the next NFP could come only in December before the next FOMC decision (but take it with a pinch of salt).
The ISM Services PMI is expected at 50.8 vs 50.0 prior. The focus will likely be on prices index. The latest S&P Global US PMIs showed an acceleration in business activity to the "second-fastest" so far this year. The agency added that "while employment growth picked up, the pace of job creation remained only modest, and weakened especially in manufacturing."
"Jobs growth was also limited by a worsening of business confidence, principally reflecting ongoing concerns over the impact of government policies such as tariffs."
"Sentiment was supported, however, by lower interest rates. Prices charged for goods and services rose at the slowest rate since April, but firms’ costs continued to increase sharply, attributed to the impact of tariffs alongside upward wage pressures."
The worsening in business confidence is mainly because of tariff policies, therefore it should improve in the next months after the US-China de-escalation.
Lastly, we have the US Supreme Court tariff hearing. The hearing follows a Federal Circuit ruling that found Trump exceeded his authority under the International Emergency Economic Powers Act (IEEPA) when imposing tariffs on several trading partners. The Court's final decision is expected by early next year, so the tariffs will remain in place for now. But even if they are striked down, Trump has other powers to impose tariffs, so in my personal view, this is not a big deal.
Central bank speakers:
- 10:00 GMT/06:00 ET - ECB's Villeroy (dovish - voter) and ECB's Nagel (neutral - voter)
- 15:00 GMT/11:00 ET - ECB's Kocher (neutral - voter)
- 16:15 GMT/12:15 ET - BoE's Breeden (neutral - voter)
- 16:30 GMT/12:30 ET - SNB's Tschudin (neutral - voter)
