The week ahead: 30 September - 4 October 2024

United States – On Tuesday we get August JOLTS job openings, where we are likely to see a rebound to 7800k after last month's steep decline. The ISM manufacturing index will drop to 47.0, a small decline as large inventories in August could be a precursor to a slowdown in production in September. On Thursday ISM releases the services PMI, which has been quite volatile in recent months. We expect it to stay flat at 51.5. Friday sees the release of the most important data release of the month at the current juncture, the labor market report. We expect a relatively strong nonfarm payrolls this month (200k), following three weak months with an average of 116k per month. Despite the stronger NFP, our model points towards an uptick in unemployment back to a low 4.3%. Apart from that, there is a lot of Fed speak, where in particular Monday's Powell speech at NABE will stand out.

Eurozone – We expect headline inflation to fall sharply, driven mainly by lower petrol prices, which fell around 3.5% m/m. We also expect core inflation to move lower, partly driven by the unwind of Olympics-related upward pressure in France. A host of ECB governing council members are set to speak. We expect tacit (in some cases explicit) endorsement of a further rate cut in October, which would be in line with our base case.

The Netherlands – Inflation (CPI) is expected to come in at 3.3% y/y for September (August: 3.6% y/y). Compared to the previous month, energy prices are expected to decline given the lower petrol prices. Generally, inflation remains a services story, driven by a higher housing rent indexation in July and still elevated wage growth creating upward pressure. Industrial good prices are expected to put downward pressure on inflation. All in all, the CPI will average 3.2% this year and 2.9% next year; still above the ECB’s 2% target.

China – Both the official and Caixin’s PMIs will be published on Monday, just before the Golden Week national holiday. Consensus expectation is for a mild uptick of the PMIs, with Caixin’s indices (with more coverage of export-oriented firms) remaining stronger than the official ones. Looking forward, the stimulus measures rolled out/announced this week will likely push China’s PMIs higher over the coming months.