It’s the end of the summer and we get back to normal levels of liquidity, with a packed docket of top tier risk events including economic data releases and major central bank meetings. Markets will also be digesting Fed Chair Warsh’s first speech at Jackson Hole delivered on Friday, in which he surprised many including us by offering his thoughts on the current state of the economy. At a pivotal juncture, he addressed demands for details on his reaction function which were taken as hawkish, while also putting broader long-term themes around productivity and AI front and centre.

More immediately, the dollar breakdown we had seen in mid-August retraced on Friday and the Index is now virtually unchanged on the month. Importantly, Treasury yields are back near their recent highs, with the 10-year just below long-term resistance around 4.73%, with the early 2025 top at 4.81%. These are big levels for bond markets, while also moving the dial on the near-term bets for the mid-September FOMC meeting. Money markets now see a 57% chance of rate hike, up from the low 30s% before Warsh spoke. We remind ourselves that the Fed does not like to surprise markets, which means typically that the odds have to be above 70%.

Of course, this means the monthly US jobs report will have a large say in price action, though there is also one more CPI report ahead of the Fed meeting in a couple of weeks. The low-hire, low-fire employment picture has persisted for some time now, even if the jobs numbers had shown renewed signs of life between March and May. However, those gains have subsequently been trimmed back by revisions, while June was a disappointing 20k and July saw an outright fall. We note that the pairing of ISM surveys with the payrolls print can cause volatility because soft survey internals ahead of a jobs number have, in past cycles, amplified the reaction to any labour-market surprise.

In Brief: Major Data Releases of the Week

Tuesday, 1 September 2026

Eurozone Inflation: Consensus sees the headline ticking up four-tenths to 3.3%, and core remaining steady at 2.5%. The former is due to the rebound in energy prices through August, while indirect effects should remain relatively modest.

US ISM Manufacturing: Expectations are for a reading of 55.1, just below the 55.5 print in July. Focus will again be on prices, with a tick-up forecast to 71.8 from 71.1. A rise is also seen in new orders, with the data being consistent with GDP growth above 2%.

Wednesday, 2 September 2026

RBNZ Meeting: A 25bps is virtually fully priced, taking the OCR to 2.75%. The economy has evolved largely as the bank and its May forecasts predicted. Core inflation remains elevated, which means RBNZ projections will likely imply another quarter point hike by year-end. Further out, growth and the labour market could be a concern.

Bank of Canada Meeting: No change to the 2.25% policy rate is forecast. There’s around 16bps priced in by December. Growth has come on stronger than the BoC anticipated given strong jobs and as stimulus works through. But trade tensions cloud the outlook. We note that relative hawkishness between commodity-bloc peers has tended to drive the NZD/CAD and AUD-adjacent crosses more than either decision in isolation.

Thursday, 3 September 2026

US ISM Services: Non-manufacturing is seen steady at 54.1, while prices paid and new orders are seen a touch softer, with employment remaining below 50. The July PMI was lower than expected but indicated expansion for a 25^th straight month as service sector momentum remains solid.  

Friday, 4 September 2026

US Non-Farm Payrolls: The headline is expected to print at 55k jobs in August, above the prior -23k, after May and June were revised down by a cumulative 103k. The unemployment rate is predicted to remain at 4.1%, and wage growth is seen at 0.3% m/m and 3.2% y/y. The household survey points to downside risks.

Canada Jobs: Consensus sees the headline print at 17.5k, down from the stellar 75.1k growth in July. The jobless rate is predicted to remain unchanged at 6.4%. August is normally a seasonal down month for employment in Canada. But there should be decent momentum in the economy given strong Q2 GDP. The Canadian jobs report arriving alongside US NFP typically mutes the CAD reaction to the domestic print, as the US number dominates the shared session.