September’s surprisingly strong US non-farm payrolls numbers (4 October) have cast a long shadow over markets and potentially changed the landscape for investors going forward.

The economy generated 254,000 new jobs, above the top end of forecasts, accompanied by unemployment falling to 4.1 % and average wage increases which hit 4% on an annualised basis.

Investors slashed bets on another jumbo half a percentage point rate cut in November as well as implying a small chance the Federal Reserve does nothing.

Incoming data continues to be volatile so it would be unwise to place too much weight on a single month’s reading. That said, CPI (consumer price index) reading (10 October) takes on more importance as investors switch attention towards the risks from stickier inflation.

The headline and core month-on-month readings are expected to slow to 0.05% and 0.24% from 0.19% and 0.28% respectively. If they prove accurate, it would slow year-on-year core inflation marginally to 3.2% from 3.3%.

US producer price inflation data for September (11 October) is also expected to cool slightly to 0.1% from 0.2% month-on-month while the core reading is forecast to drop to 0.2% from 0.3%.

A reigniting of inflationary pressures would likely see bond yields rise further and give the Fed pause for thought on its ‘recalibration’ of monetary policy.

The end of the week (12 October) sees the University of Michigan consumer sentiment index reading for October with economists expecting a slight uptick to 70.5.

The 15 October sees the release of UK hourly earnings and unemployment data for August while we also get a raft of European inflation data for September.

The following day sees the release of September inflation data from the UK, which will be closely watched given recent comments by Bank of England governor Andrew Bailey suggesting good news on that front could allow faster rate cuts. 

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