The downward revision of the preliminary data on the number of new jobs created in the U.S. economy in the 12 months to March 2025 inclusive, strengthened Wall Street's confidence that the U.S. Federal Reserve will begin a cycle of aggressive rate cuts. The key event this week will be the regulator's meeting, following which it will announce a decision on monetary policy. Despite the fact that US inflation is above the Fed's 2% target, a weakening labor market almost guarantees an interest rate cut at the upcoming meeting, according to Barron's. The main question on investors' minds is how many more rate cuts will follow before the end of this year and into 2026.

In the corporate market, the key will be the quarterly report of FedEx. The financial results of this logistics giant are traditionally seen as an indicator of the state of global trade and the U.S. economy as a whole, Yahoo Finance notes. Wall Street will also get earnings updates from real estate developer Lennar, food giant General Mills and restaurant operator Darden. Rounding out the quiet reporting disclosure schedule this week will be country-style roadside restaurant chain Cracker Barrel, which recently made headlines for its controversial rebranding.

On Monday, September 15, the Federal Reserve Bank of New York (the most important of the 12 reserve banks in the U.S. Federal Reserve System) will publish an index of business activity in the manufacturing sector (Empire State Manufacturing Survey) for September. Economists on average forecast the index value at the level of 4.8 points. This is 7 points lower than the August value, which was the highest since November 2024. Positive values of the index indicate growth, while negative values indicate decline.

The National Bureau of Statistics of China reported that industrial production and retail sales in the world's second largest economy in August recovered slower than the market had hoped. According to the agency, industrial production in the last month of summer grew by 5.2% in annualized terms, slowing from 5.7% in July and below the forecast of 5.8%. Retail sales increased by 3.4%, the lowest pace in eight months, as the effect of the trade-in program (exchange of old goods for new ones with additional payment) began to fade, Trading Economics said.

On Tuesday, September 16, the U.S. Census Bureau will report the nation's retail sales data for August. The consensus forecast assumes a 0.2% increase from the previous month after a 0.5% increase in July.

On Wednesday, September 17, the Federal Open Market Committee of the U.S. Federal Reserve will announce the interest rate decision and publish the quarterly "Summary of Economic Projections" (Summary of Economic Projections). Wall Street expects a 0.25 percentage point rate cut to 4-4.25%. There is also a slight possibility of a larger cut of 50pc. LSEG data show that investors also put in quotations high chances of a rate cut in October and December, according to The Wall Street Journal.

Bullish and General Mills will present last quarter's financial reports.

On Thursday, September 18, the decision on the interest rate will be announced by the Bank of England. The market expects the regulator to leave the rate at 4% due to high inflation. Therefore, investors' attention will be focused on signaling when interest rates may start to fall again. UK financial markets currently estimate the probability of another interest rate cut in 2025 at only 36%.

Cracker Barrel, Darden Restaurants, FedEx and Lennar will report quarterly earnings.

On Friday, September 19, the Bank of Japan will announce its interest rate decision. The market is betting that the Japanese Central Bank will keep it at 0.5%. Japanese Prime Minister Shigeru Ishiba's decision to resign has sparked speculation that the new Prime Minister may favor a looser monetary policy. Nevertheless, economists generally still expect the Bank of Japan to resume tightening soon, as inflation in the country persists and foreign trade risks begin to weaken.

This article was AI-translated and verified by a human editor

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