Eurozone Inflation Prints, US PCE Data Set Stage for Crucial Rate Hike Decision

The European Central Bank's (ECB) Isabel Schnabel and Federal Reserve's Michelle Barkin will both give speeches today, while minutes from the Riksbank's September meeting are also expected. The data releases in Europe and the US will provide more insight into inflation trends.

Today, inflation prints from Germany, France, and Italy will be released, giving hints to where the euro area's overall data will land on Friday. In the US, August PCE inflation is set to be published in the afternoon, with headline inflation likely rising from July driven by higher energy prices. The US Bureau of Economic Analysis will also update its methodology for some PCE subcomponents, which should provide relief to core inflation.

However, given the strong underlying economy, core PCE could still tick up. Additionally, the final revision of Q2 GDP will be released today. In Japan, the quarterly Tankan business survey is expected overnight, with PMIs suggesting a strong momentum in Q3 driven by easy fiscal policy and a weak yen.