by Kim | Apr 20, 2026
This weekly macro outlook note highlights the key economic, central bank, and geopolitical events shaping the outlook for global markets in the week ahead.
The key events for the w/c 20 April 2026: US retail sales, global CPI reports, Prelim S&P PMIs April
Recap of Last Week: The Leading-Edge Impact
We are starting the week under yet another fresh layer of geopolitical uncertainty.
The optimism over Friday’s announced reopening of the Strait of Hormuz has been clouded by the Iranian authorities’ weekend reversal and subsequent re-closure of the waterway. Further talks between the U.S. and Iran are expected to take place early this week to address the deadlock. While markets have been pricing in a successful de-escalation, we are now entering the eighth week of the closure, and the flow of oil production remains severely disrupted. The risk of structural damage to a global supply chain that is steadily losing its cushion remains elevated.
If the evolution of this conflict is now a primary driver for the macro outlook, then the latest data for March and April represents the leading edge of a transmission that is tracking the Strait’s closure in real-time. Whether these impacts become enduring or become more widespread will depend on the duration of the conflict.
So far, the data is continuing to reflect a sharp reaction in headline inflation alongside notable declines in both business and consumer sentiment.
US PPI Indicates Higher PCE Inflation for March
While the U.S. PPI rose by less than expected in March (+4% over the year vs. +4.7% expected), it still marked an acceleration from February’s +3.4%. There was a notable increase in energy and goods prices, while services (final demand) price growth slowed. Based on the March CPI and PPI reports, the latest Cleveland Fed PCE inflation nowcast shows headline PCE inflation is expected to increase to +3.4% in March (from +2.8% in Feb), while core PCE inflation is also expected to edge higher to +3.2% in March, from +3% in Feb. The FOMC will be increasingly concerned about the duration of this conflict and will be monitoring for evidence that these headline spikes are beginning to bleed into core inflation.
Fed’s Beige Book: Widespread Uncertainty as Margins Compress
The Beige Book for April will be a key input for the FOMC meeting next week, and inflation concerns were a key highlight. Unsurprisingly, the “vast majority” of districts reported moderate increases in inflation due to higher energy prices. Input price growth is currently outpacing increases in selling prices, suggesting that firms are absorbing costs through margin compression rather than full consumer pass-through at this stage. However, cost pressures are broadening beyond energy to include tariffs, technology, and healthcare. Employment remained in its low-hire, low-fire dynamic, as contacts expressed widespread uncertainty about future conditions.
Activity: Housing & Industrial Output Slowing
Growth signals remained lacklustre last week. US housing market activity remained at or near pandemic lows, as existing home sales fell to a 3.98m annualized pace in March, while the home builder sentiment index for April fell to 34, approaching the Covid-lows.
Industrial output for March fell by -0.5% as manufacturing output fell by -0.1% in March (from +0.4% in Feb). More notable falls in output were recorded across the mining and utilities sectors. Headwinds continue to weigh on small business owners; the NFIB Small Business Optimism Index fell again in March, with a sharp 11-point decline in earnings trends highlighting the impact of elevated input costs.
FOMC Policy Implications: The Waller Framework
Fed Governor Waller provided a clear framework for navigating this conflict last week. The policy outlook currently hinges heavily on how this conflict evolves. He presented two scenarios:
Normalization: if the Strait reopens and oil flows start to normalize, he could look through a short-lived impact from energy prices on inflation. With his concern over the labor market still elevated, he would expect a possible rate cut late in the year as the outlook ‘steadies’. At the time of writing, and likely reflecting the optimism from the Strait reopening late last week, the market has begun to reflect that scenario in the FFR probability distribution – shifting further toward a Dec/late 2026 rate cut (source: CME FedWatch).
Risk of a Longer Duration Conflict: His second scenario, though, highlights the core concern for most central bankers related to this conflict:
“But the longer energy prices remain elevated and the Strait is constrained, the greater the chances that higher inflation gets embedded across a wide variety of goods and services, various supply chain effects start to emerge, and real activity and employment start to slow.”
Balancing the Fed’s dual mandate risks would likely mean maintaining the policy rate at the current target range for longer. In other words, due to the downside risks of the labor market, Waller doesn’t see rate hikes on the table at this point.
Global Central Bank Context
Based on the uncertainty over the conflict in the Middle East, now into its eighth week, several central bankers signalled a more cautious stance for upcoming meetings.
BoJ: Governor Ueda’s speech indicated risks remain “two-sided,” shifting the April meeting to a toss-up between a hold and a hike.
ECB: Various ECB speakers signalled a growing preference not to ‘rush’ an April decision, leaning toward a more cautious timeline.
RBA (the exception): Pricing for another RBA rate hike in early May increased after the March labour market report (source: ASX RBA Rate Tracker).The unemployment rate stayed unchanged at 4.3%. The latest business and consumer confidence reports show notable falls in confidence amid fuel price increases and interest rate rises. For the most part, this souring in sentiment is yet to flow through to broader business conditions (as of March).
Outlook for the week ahead: US retail sales, global CPI reports, Prelim S&P PMIs for April
The week ahead will continue to focus on the elevated geopolitical headline risk – will the Strait be open or closed?
It will remain a relatively quiet week on the data front. We continue to track the transmission of the energy price shock: this week through US retail sales for March and through global CPI reports for Japan, the UK, NZ, and Canada for March.
The preliminary S&P PMIs for April will also provide further insight into the evolution of activity, prices, and sentiment in the second month of the conflict and at the start of Q2.
It’s the blackout week ahead of the FOMC meeting next week, although there will be a speech by Fed Governor Waller. He is not likely to cover the economic outlook or monetary policy in this speech.
The confirmation hearing for the new Fed Chair nominee is expected to take place this week.
Key factors & events to watch this week:
US Retail Sales
The key highlight will be US retail sales for March, which is still early in the conflict. US retail sales are presented in nominal terms and are likely to be ‘inflated’ due to the higher gasoline prices.
- US retail sales for March are expected to increase by +1.4% over the month, up from +0.6% in Feb. The growth ex-gasoline versus the prior month should provide a consistent view of retail sales growth.
- The retail control measure increased by +0.5% in Feb, and this will be a key measure for how retail sales flow through to GDP expenditure measures.
The FOMC and Central Bank Speeches
- It’s the blackout period ahead of the FOMC meeting next week.
- However, there is one speech scheduled this week: Fed Governor Waller: Modernizing Reserve Bank Operations, Brookings Institution Event, Washington, D.C.
- The confirmation hearing for Kevin Warsh is scheduled for 21 April.
Global CPI reports – March
Again, headline inflation rates are expected to increase, while core inflation is expected to be little changed, reflecting still an early stage of the energy price shock.
- Canada CPI: headline CPI is expected to increase by +1.1% over the month in March, up from +0.5% in Feb. Headline inflation is expected to increase from +1.8% in Feb. Annual core inflation: the trimmed mean is expected to remain unchanged at +2.3% over the year, while the median inflation rate is expected to edge higher to +2.4% over the year, up from +2.3%.
- NZ CPI for Q1: CPI is expected to increase by +0.8% over the quarter, up from +0.6% in Q4 2025. The annual rate is expected to slow to +2.9% in Q1 from +3.1% in Q4.
- UK CPI: headline CPI is expected to increase to +3.3% in March, up from +3% in Feb. Core CPI in the UK is expected to be unchanged at +3.2%.
- Japan National CPI: the headline CPI had slowed to +1.3% in February, and the March result may reflect both the rise in energy prices as well as government subsidies. The BoJ-preferred core CPI ex fresh food is expected to edge slightly higher to +1.7% in March, from +1.6% in Feb.
The preliminary round of S&P Global PMIs for April will be released for key economies, providing some insight into the evolution of growth momentum, prices, and sentiment as we head into the second month of the conflict.
This week, the US Treasury will auction and settle approx. $460bn in ST Bills with a paydown of $44bn. The US Treasury will also auction the 5-Year TIPS and 20-Year Bond this week – both to settle next week.
Approx $18.6bn in ST Bills will mature on the Fed balance sheet and be reinvested.
A detailed version of this outlook, including the full calendar of key data releases, is available in the briefing document below:
Comments and feedback are welcome. Please email me at kim.mofardin@marscapitalpartners.net
by Kim | Apr 13, 2026
The key events for the w/c 13 April 2026: US PPI, Fed Beige Book, Speeches
Macro Recap: Early US Inflation Effects
The ceasefire optimism from last week is at risk following the breakdown of talks between the US and Iran over the weekend. With the Strait of Hormuz closure entering its seventh week and the U.S. threatening its own “blockade”, we continue to skirt the boundary between a more temporary inflation and supply disruption and a potentially broader, longer-lasting structural impact.
While the US blockade threat may be another diplomatic “escalate to de-escalate” tactic, the longer these production and maritime disruptions remain unresolved, the greater the likelihood that this energy shock evolves from a short-term supply squeeze into a broader near-term headwind for the global economy.
US PCE Inflation Pre-Conflict Baseline
The risks are already emerging as the energy price shock translates into US domestic inflation data released last week.
The Fed-preferred PCE inflation gauge for Feb provided a pre-conflict baseline – showing inflation was already more persistent leading into this conflict. Both the headline PCE inflation (at +2.8%) and core PCE inflation (at +3%) have edged higher, especially over the last three months, partly driven by the ongoing pass-through of tariff-led core goods inflation. If there is a silver lining, it’s that the trimmed mean and median PCE measures suggest that this recent firmness has not been part of a broadening bout of inflation. However, the inflation rate among the top outliers remains a concern for the Fed, with the top “trim” showing a weighted average inflation rate of +21% (one-month annualized) in Feb.
The March CPI Shock
The more leading-edge March CPI sounded a warning over the swift transmission of higher energy prices into US domestic headline inflation. CPI energy prices jumped by +11% in March, led by a +21% increase in gasoline prices over the month in Mar. As a result, headline inflation jumped from +2.4% in Feb to +3.3% in Mar. These higher energy prices are yet to flow through to the core CPI measure, which still increased to +2.6% in Mar (from +2.4% in Feb). A more stable core inflation backdrop (and anchored expectations) through this shock enables the Fed to continue to “look through” what could still be a short-term disruption. However, the primary risk for the Fed is that the longer these supply-side disruptions persist, the more likely they are to anchor higher inflation expectations, keeping the committee alert to broad-based pass-through effects.
Growth “Resilience” Under Pressure
These inflation pressures arrive at a time when growth momentum also appears to be cooling. While the ‘final’ GDP report for Q4 showed growth slowing to a mere +0.5% annualized rate (impacted by the government shutdown), the expected rebound in Q1 has yet to materialize. So far, the Atlanta Fed GDP nowcast tracking (data roughly reflecting about two-thirds of the way through Q1) shows the growth run rate slowing to a +1.3% annualized pace (from +1.6% a week ago). While there has been a drag from net exports, the contribution from consumer spending so far in this quarter has become smaller (usually the largest contributor), even before the effects of higher energy prices. The US services PMIs released last week (March) signalled a number of concerns with slowing growth momentum, rising prices, and pressure on employment growth. The further notable fall in the Michigan consumer sentiment measures at the start of Apr underscores the fragile nature of the consumer spending outlook.
FOMC Minutes
FOMC minutes reveal a committee already concerned that “further progress in reducing inflation had been absent in recent months”. The Fed is now managing the tightening tension between its dual mandate goals of employment (still downside risks) and price stability (upside risks, especially due to developments in the Middle East). Regarding the Middle East, the Committee noted that higher oil prices would “delay the anticipated decline in inflation” and could cause expectations to drift upward. For now, the conflict will keep the Fed in a ‘wait and see’ mode as it monitors the scope and duration of the shock, effectively pushing the timing of any potential rate cuts further out. Current market pricing shows the Fed on hold through the next twelve months.
Outlook for the week ahead: US PPI, Fed Beige Book, Speeches
The week ahead will continue to focus on the elevated geopolitical headline risk as the US threatens a blockade (or a deal).
It will be a relatively quiet week on the data front. While not market movers on their own, the data points may provide a “health check” on how the US economy is absorbing the initial wave of the shock. This week: US PPI for March, the Fed Beige Book, several March data points (industrial production & existing home sales), and a number of April surveys of US housing and manufacturing.
It’s the final week of Fed speeches ahead of the blackout period. This week, Fed Governor Waller will give a speech on the economic outlook – likely an important perspective for how the Fed may navigate the current conditions leading into its upcoming meeting on 28-29 April.
Outside of the US, there will be a range of Chinese data for March and Australia Labour Market for March.
The IMF spring meetings will take place this week, including a range of speeches throughout the week.
Key factors & events to watch this week:
US data
There will be a range of US data this week (both March and April data points), providing some early/limited insight into how parts of the US economy have been affected by the conflict so far.
- The PPI report for March will help to provide a guide for the upcoming Fed-preferred PCE inflation measure.
- Headline PPI is expected to increase by +1.2% over the month in Mar (from +0.7% in Feb) – this would see annual PPI inflation increase to +4.7% in Mar (from 3.4% in Feb).
- Core PPI is expected to increase by a more moderate +0.5% in Mar (also +0.5% in Feb), which would still see annual core PPI increase to +4.2% in Mar (from +3.9% in Feb).
- US import and export prices may also begin to reflect some pricing effects in Mar.
- US housing data for Mar & Apr may reflect the increase in mortgage rates through March. Existing home sales are expected to slow to a 4m annualized rate in Mar, from 4.1m in Feb. The NAHB home builder sentiment survey for Apr is expected to remain subdued at 37.
- US Industrial Production for Mar is expected to increase by +0.2% (after falling by -0.1% in Feb). There will also be a range of Apr regional manufacturing surveys providing a view on manufacturing activity and the business outlook, now seven weeks into this conflict.
- The Fed’s Beige Book for the last six weeks will provide important anecdotes from business contacts among the Fed districts on growth, spending, employment, sentiment, and inflation over the last six weeks and will be an important input for the upcoming Fed meeting.
Fed & Central Bank Speeches
- This is the final week for speeches leading up to the next Fed meeting on 28-29 April. There will be a range of speeches this week; however, the main one will be Fed Governor Waller on Friday, speaking on the ‘economic outlook’ – which will be an important speech for outlining his view on assessing current conditions. Governor Waller also shifted his view at the last meeting from dissenting in favour of a cut at the Jan meeting to voting for a hold in Mar.
- There will also be a range of other Central Bank speeches this week as part of the IMF Spring meetings – likely to be dominated by the Middle East conflict fallout.
China Economic Data
This week, key growth, output, retail, and trade data are expected to close out Q1.
- GDP for Q1 is expected to increase by +1.4% over the quarter, and +5% over the year (up from +4.5% in Q4 2025).
- Industrial production and retail sales (annual) growth in Mar is expected to slow slightly.
- Trade data for Mar is also expected to show slower growth in imports and exports over the year.
Australian Data
There will be several points of interest this week ahead of the RBA meeting on 4-5 May.
- The NAB business confidence & conditions survey for Mar will provide some insight on key survey measures quoted by the RBA previously on capacity utilisation and what it means for their assessment of the inflation backdrop.
- The Aus Labour Market report for Mar is expected to show net employment growth of +20k (down from 49k in Feb), while the unemployment rate is expected to stay unchanged at 4.3%.
This week, the US Treasury will auction and settle approx. $629bn in ST Bills, Notes, and Bonds with a paydown of $5bn.
Approx $35bn in ST Bills, Notes, Bonds, and TIPs will mature on the Fed balance sheet and be reinvested.
More detail (including a calendar of key data releases) is provided in the briefing document – download the pdf below:
Comments and feedback are welcome. Please email me at kim.mofardin@marscapitalpartners.net
by Kim | Apr 6, 2026
The key events for the w/c 6 April 2026: US inflation (PCE Feb, CPI Mar), ISM Services PMI, FOMC Minutes, RBNZ Meeting
Macro Recap: Testing the Resilience of the US Economy
The geopolitical conflict and uncertainty involving Iran continues to anchor market sentiment, though the nature of the uncertainty is evolving. Beneath the surface of the daily noise, the primary signals remain unchanged: energy production curbs persist, and the Strait of Hormuz remains effectively closed, with Iran managing specific conditions for limited traffic.
The longer these core disruptions remain unresolved, the greater the likelihood of longer-lasting economic damage. As the conflict teeters on the edge of becoming a protracted event, we shift our focus toward tracking its tangible impacts on U.S. and global economic resilience, including the expected inflation shock.
Mixed US Labor Market Signals
While last week’s US labor market data for March provided mixed signals, there was a more positive edge leading into the conflict. Growth in non-farm payrolls of +178k in March was stronger than expected. Revisions to prior months were small: net -7k. While monthly payroll data has been volatile recently, the March print suggests the labor market may have been on a more positive trajectory before the conflict. Importantly, job growth broadened across industries this month, moving beyond the narrow gains seen last month. However, this strength was tempered by the household survey, where the unemployment rate edged down to 4.3% primarily due to a drop in labor force participation, rather than an increase in employment. This reinforces that the recent “low dynamism” gear has continued.
Other parts of the labor report suggest some pressure for nominal labor income growth in March. Despite the stronger growth in payrolls, aggregate hours worked continued to contract in March, posting two consecutive months of decline. Annual growth in aggregate hours worked remains largely subdued at a mere +0.4% over the year. At the same time, growth in average hourly earnings also slowed to +0.2% over the month, and to a near-term low of +3.5% over the year. With headline inflation set to rise, this may begin to place added pressure on the spending power of that income.
Growth Resilience Under Pressure
The US growth resilience appears to be coming under pressure further into Q1. The latest Atlanta Fed GDP nowcast for Q1 showed growth edging lower to +1.6% based on data released last week:
- US Trade (Feb): The largest contributor to the slower growth run rate was a larger-than-expected trade deficit in Feb.
- Retail Sales (Feb): The contribution from consumer spending edged lower, despite a seemingly rosier retail sales result. The nominal retail control group data (which feeds into the GDP calculation) increased by +0.5% in Feb, but Jan growth was revised lower from +0.3% to +0.2%.
- The ISM Manufacturing PMI (Mar): Demand conditions remained moderate, and the broader headline PMI edged up from 52.4 in Feb to 52.7 in Mar. Unsurprisingly, the ISM prices index began to show the first impact of higher energy prices and supply chain disruption from the conflict, rising to the highest level since 2023. Just under two-thirds of firms reported higher prices this month, while the report also noted a broad range of commodity prices rising this month.
Global Impact and Inflation
The second pillar for the week involved data points more directly exposed to the geopolitical shock. The Eurozone prelim CPI for Mar showed headline inflation rising by +1% over the month – led by a +4.9% increase in energy prices. Annual headline inflation is expected to increase to +2.5% in March (from +1.9% in Feb). Importantly, core CPI has remained fairly stable at +2.3% in March (from +2.4% in Feb).
The global manufacturing PMI reading edged down slightly, but remained in positive expansion in March. The effects of the conflict were most evident in the sharp rise in the global input price index for March. The remainder of the full suite of global PMIs will be released this week (services).
Outlook for the week ahead: US inflation (PCE Feb, CPI Mar), ISM Services PMI, FOMC Minutes, RBNZ Meeting
A heavy data calendar remains in place this week as markets continue to navigate significant geopolitical uncertainty and headline risk. This week, we continue to focus on evaluating U.S. domestic resilience and tracking the broader global impact of the Middle East conflict.
U.S. Domestic Activity: The main focus this week is on the key US inflation data. This will include the February PCE (a pre-conflict baseline) inflation report and, importantly, the March CPI report, which will provide the first look at the pass-through of the energy price shock into US domestic inflation. Building out our view of the evolving domestic growth backdrop will be personal spending & income, factory activity, and the Q4 GDP (final release). Additionally, the latest FOMC minutes will offer further insight into the Committee’s decision to remain on hold at the March meeting.
Global Impact: On the global front, the final suite of S&P Global Services PMIs will be released, providing a view on any initial impacts of the conflict on the services sector.
Key factors & events to watch this week:
US Inflation
There will be two inflation reports this week. The first will be pre-conflict: the Fed-preferred PCE price index for Feb. The second will be a more closely watched CPI for March, which is expected to reflect the notable impact of rising energy prices.
- Headline PCE inflation for Feb is expected to increase by +0.4% over the month, up from +0.3% in Jan. This would leave headline PCE inflation unchanged at +2.8% in Feb.
- Core PCE inflation for Feb is also expected to increase by +0.4% over the month in Feb (from +0.4% in Jan). This would see annual core PCE inflation slow to +3% in Feb (from +3.1% in Jan).
- Headline CPI for March is expected to increase by +0.9% over the month, up from +0.3% in Jan. Annual growth in headline CPI is expected to jump to +3.4% in Mar, from +2.4% in Feb.
- Importantly, core CPI is expected to only edge slightly higher to +0.3% over the month in Mar (from +0.2% in Feb). Annual growth in core CPI is expected to increase to +2.7% in Mar, from +2.5% in Feb.
US Growth Backdrop
The tracking for US GDP growth so far in Q1 has edged lower to a +1.6% run rate based on the latest update of the Atlanta Fed GDP nowcast. Several reports this week will add further to the Q1 tracking:
- Personal spending for Feb is expected to increase by +0.5% (from +0.4% in Jan).
- Personal income for Feb is expected to increase by +0.3% in Feb (down from +0.4% in Jan).
- Factory Orders for Feb are expected to slow, falling by -0.2% in Feb (from +0.1% in Jan).
- The ISM Services PMI is expected to edge lower to 55 in Mar (from 56.1 in Feb).
- The final estimate for Q4 GDP is expected to confirm the +0.7% annualized growth rate.
US Federal Reserve
- The latest FOMC meeting minutes will be released this week.
- Fed Vice Chair Jefferson will give a speech on the economic outlook this week.
RBNZ
- The RBNZ meets this week and is expected to keep its policy rate unchanged at 2.25%.
Global Developments
- China’s CPI for Mar is expected to be little changed over the year at +1.2% in Mar (from +1.3% in Feb)
- Canada’s labour market survey for March is expected to show a small rebound in employment growth of +12.6k (from -83k in Feb), while the unemployment rate is expected to tick up to 6.8% (from 6.7% in Feb).
- The remainder of the S&P Global Services PMIs for March will be released this week.
This week, the US Treasury will auction and settle approx $460bn in ST Bills, with a paydown of $54bn.
The US Treasury will also auction the 3-year and 10-year Notes, and the 30-year Bond this week, to settle next week.
More detail (including a calendar of key data releases) is provided in the briefing document – download the pdf below:
Comments and feedback are welcome. Please email me at kim.mofardin@marscapitalpartners.net
by Kim | Mar 30, 2026
The key events for the w/c 30 March 2026 – US: non-farm payrolls, ISM manufacturing PMI, & retail sales, Global PMIs, Euro area CPI (prelim) Mar
Macro Recap: Gauging the Economic Impact
The conflict involving Iran is now entering its fifth week, with the Strait of Hormuz effectively closed. While markets remain sensitive to headlines and the prospect of a sudden diplomatic resolution, recent developments suggest the risk of a more protracted timeline. Frequent claims of “progress” and “negotiations” have been met with Iranian rebukes. Reports of U.S. ground troop arrivals indicate a potential shift in the scope of the engagement. As this conflict moves from days into months, concern is growing over the potential for lasting economic damage.
S&P Prelim PMIs – March
Our attention now shifts to the incoming March data to begin the task of gauging the economic impact of this latest shock. The longer the crisis keeps the Strait closed, the greater the risk of a more pronounced and persistent effect on both prices and growth.
Last week’s prelim S&P PMIs for March provided an early look at this impact. Reflecting data collected between March 12 and 23, these reports capture the initial reactions of firms to the escalating conflict. Most regions noted more widespread input price pressures driven by higher energy costs, the building of safety stocks, lengthening lead times, and waning sentiment in the outlook.
Across the major economies, the PMIs revealed a divergence in resilience:
- UK & Eurozone: these markets are more exposed to the energy impacts of the conflict and have already shown signs of weakening output and rising prices. In the Eurozone, the slowdown was led by services, while the UK recorded slower output growth in both services and manufacturing sectors.
- Japan: the prelim PMI reflected a modest slowdown in the growth trajectory, but remained in expansionary territory. The Japanese government was already implementing a large-scale fiscal response to cost-of-living pressures (inflation) before this conflict, and has now moved to include gasoline subsidies to buffer the impact of further inflation pressure on households.
- Australia: There was a sharp turnaround in the Aus PMIs, led by a shift in services output from moderate expansion in Feb to a notable contraction in Mar. Part of this stronger reaction may be the result of the initial hike in interest rates at the start of Feb to reign in already persistent inflation. Now, there is the added pressure of the Middle East conflict and a follow-up rate hike at the Mar meeting.
- US: The prelim PMI showed output growth only edged slightly lower, with the expansion remaining modest for now. The pullback in demand for services was only partially offset by an expansion in manufacturing output as firms began to build safety stock amid the Middle East uncertainty. Input and output price increases became more widespread. Sentiment in the outlook was mixed; however, the composite employment index contracted slightly for the first time since Feb 2025.
Outlook for the week ahead: US: non-farm payrolls, ISM manufacturing PMI, & retail sales, Global PMIs, Euro area CPI (prelim) Mar
A heavier data calendar arrives this week as markets continue to navigate significant headline risks. The focus is twofold: tracking the resilience of the U.S. domestic backdrop and identifying the broader global impact of the Middle East conflict.
U.S. Domestic Resilience: Key updates will provide an updated view of the U.S. labor market and the domestic growth trajectory. This includes non-farm payrolls for Mar, retail sales for Feb, and the ISM manufacturing PMI for Mar.
Global Impact and Inflation Outlook: The second pillar of the week involves data points more directly exposed to the geopolitical shock. The Eurozone prelim CPI for Mar will be an important gauge of headline versus core inflation divergence. Additionally, the full suite of Global S&P PMIs will offer a more comprehensive look at initial impacts on supply chains and input costs across various regions.
Despite the shortened week due to the Easter holiday, U.S. non-farm payrolls will be released as scheduled on Friday, April 3.
Key factors & events to watch this week:
US Labor Market – March
Markets are expecting a rebound from last month’s weak labor market report; however, conditions are broadly expected to reflect that the ‘low dynamism’ mode is persisting.
- Non-farm payroll growth is expected to rebound to +56k in Mar (from -92k in Feb). The direction of revisions will also be important for any change in the trajectory of growth.
- The unemployment rate is expected to be unchanged at 4.4% in Mar.
- Participation is expected to be little changed at 62%.
- Average weekly hours are expected to be unchanged at 34.3 hours.
- Average hourly earnings are expected to increase by +0.4% over the month in Mar (unchanged from Feb), while the annual pace is expected to increase by +3.8%.
- The JOLTS report for Feb is expected to show job openings slow to 6.9m, down from 6.94m in Jan.
- The Challenger Job Cut Announcement survey for Mar may provide some further anecdotes on labor demand. Last month, job cut announcements fell to 48k.
US growth backdrop
The tracking for US GDP growth so far in Q1 has edged lower to 2% based on the latest update of the Atlanta Fed GDP nowcast.
- US retail sales are expected to increase by +0.4% in Feb, rebounding from -0.2% in Jan.
- The ISM manufacturing PMI for March may also start to reflect some initial impact from the Middle East conflict on US firms. The headline PMI is expected to be little changed at 52.3 in Mar. The ISM Services PMI for Mar will be released on 6 Apr.
FOMC speeches
- There will be several speeches throughout the week. Of note will be Fed Chair Powell in a “moderated discussion” at Harvard University. It’s unclear whether he’ll speak on the economic outlook at this event.
- NY Fed President Williams will also give keynote remarks on Monday on the economy.
Euro area CPI Prelim – March
This prelim release for the Euro area CPI will be one of the first official CPI reports for the initial month of the conflict; however, the final release in two weeks should provide a more complete view. While headline inflation is expected to increase on the back of higher energy costs, the trend of core inflation will remain most in focus for the ECB throughout this shock, to gauge whether higher energy prices are feeding into broader inflation.
- Euro area headline CPI – prelim Mar is expected to increase by +2.5% over the year in Mar, notably higher than the +1.9% inflation rate in Feb.
- Core CPI is expected to be unchanged at +2.4% in Mar (from +2.4% in Feb).
The full suite of S&P Global PMIs for March may show some early impacts from the Middle East conflict.
Other key releases this week:
- The RBA minutes of the last meeting (consecutive rate hike) will be released this week and should provide some insight into the debate over the decision to hike now versus hike later, resulting in the close 5-4 decision to hike in Mar and what that might mean for the near-term path of rates.
- UK GDP growth for Q4 is expected to remain subdued at +0.1% over the quarter, and +1% over the year.
- Tokyo CPI for March could provide an early view of inflation impacts in Japan, while accounting for key government subsidy offsets. Tokyo Core CPI ex fresh food is expected to be unchanged at +1.8% over the year.
This week, the US Treasury will auction and settle approx $690bn in ST Bills, Notes, Bonds, and TIPS, raising approx. $37bn in new money. Approx $38.4bn in ST Bills, Notes, and Bonds will mature on the Fed balance sheet and will be reinvested.
More detail (including a calendar of key data releases) is provided in the briefing document – download the pdf below:
Comments and feedback are welcome. Please email me at kim.mofardin@marscapitalpartners.net
by Kim | Mar 23, 2026
The key events for the w/c 23 March 2026: Prelim S&P PMIs March, global CPI reports: Japan, Aus, and the UK
Macro Recap: The Central Bank Response
The conflict in the Middle East has now entered its fourth week, with the Strait of Hormuz remaining closed. Markets are closely watching developments around the US ultimatum to reopen the Strait, with headline risk elevated in both directions.
Against this backdrop, last week’s central bank meetings provided important insight into how policymakers are assessing the risks of this evolving shock. While policy decisions diverged, a common theme emerged: central banks have shifted into a more conditional stance, balancing rising inflation risks from energy prices against uncertainty around the duration and impact of the conflict.
But as policymakers moved to manage expectations, global bond markets responded with a notable sell-off, pushing yields higher as investors began to price in the inflationary implications of a prolonged energy shock.
RBA: +25bps Hike
This was the second consecutive hike by the RBA, which signalled a pull-forward of its expected May hike. The primary driver of the decision was the further upside risk to inflation due to the energy price shock, occurring against a backdrop where inflation was already “too high”. The 5-4 decision in favour of a hike (versus hold) reflected a Board split on when to hike, not whether to hike.
“The Board concluded that the cash rate was not at a level consistent with returning inflation to target within a reasonable time frame.” RBA Governor Bullock
BoE: Hawkish Hold
The decision to stay on hold was unanimous. Before the onset of hostilities, markets had priced the possibility of a cut at this meeting. The decision to hold reflected a sharp pivot from the “continued disinflation” narrative to the expected inflation risk “caused” by this conflict. As a result, guidance shifted from “expecting more cuts” to “stand ready to act”. The key friction, however, stems from a growth and labour market backdrop that is far more subdued than during the energy price shock in 2022, a point noted by Governor Bailey.
“The recent experience of high inflation may also make households and businesses more sensitive to a new inflationary shock. At the same time, the starting point for this shock is a real economy with limited pricing power. Holding Bank Rate at this meeting is appropriate.” BoE Governor Bailey
BoJ: Hawkish Hold
The BoJ retained its guidance for hikes and policy normalisation. The decision to hold maintained the balance between achieving its inflation target through the “virtuous cycle” of wages and prices while the economy continues to recover. Governor Ueda expects that downward growth impacts from the conflict would likely be temporary; if so, rate hikes remain on the table. He also noted concern among Board members that inflation risks were skewed to the upside by energy prices. Furthermore, Takata’s dissent explicitly highlighted a key friction: upside risks to inflation against an inflation backdrop already largely at target with inflation expectations rising ‘moderately’.
“Even if economic growth were to decline, if that development is temporary and there’s not so much impact on the trajectory of the price trend then of course it will be possible to raise interest rates,” BoJ Governor Ueda
FOMC: Hold
A more neutral decision by the FOMC, albeit with hawkish undertones. The hold was based on the ongoing tension in the Fed’s dual mandate goals, where upside risks to inflation exist against the backdrop of downside risks to the labor market. While Chair Powell noted several times that it was “too soon” to establish the scope and duration of the conflict’s impact, committee members upgraded their growth and inflation outlooks. During the press conference, Chair Powell highlighted a lack of progress on core goods inflation. The FOMC maintained its easing bias, but trimmed expectations to a median of one cut this year.
“Not as much as we had hoped, but some progress on inflation. It should come as we start to see in the middle of the year, progress on tariffs going through once and then tariff inflation coming down. That’s — we should be seeing that. And the rate forecast is conditional on the performance of the economy. So if we don’t see that progress, then you won’t see a rate cut.” Fed Chair Powell
ECB: Hawkish Hold
The decision to stay on hold maintained its “Three Times Two” (2% Target, 2% Expectations, 2% Rates) baseline. However, risks have diverged, with forecast revisions for higher inflation and lower growth due to energy prices. Europe is at the forefront of this unfolding energy price shock, and uncertainty remains elevated. The ECB outlined two key scenarios for action and signalled greater agility and preparedness in the face of this latest shock.
“I think we are both well positioned and well equipped to deal with the development of a major shock that is unfolding, and we will continue doing that.” ECB President Lagarde
BoC: Dovish Hold
The decision to stay on hold primarily cited recent weaker activity and downside growth risks, while remaining alert to the inflationary risks from rising energy prices. The BoC has been lowering rates (now at the lower floor of ‘neutral’) to support the economy through structural trade and tariff adjustments; inflation slowed to +1.8% in Feb. While the Bank would look through the immediate impact on inflation, it remains committed to preventing those effects from broadening and becoming persistent. The BoC appears alert to a policy error – hiking into weakening economy in early 2026 – and shifted guidance, removing “the policy rate remains appropriate”.
“With inflation close to target and the economy in excess supply, the risk that higher energy prices quickly spread to the prices of other goods and serviceslooks contained.” BoC Governor Macklem
Outlook for the week ahead: Prelim S&P PMIs March, global CPI reports: Japan, Aus, and the UK.
The week ahead is relatively light on data, but the macro backdrop remains dominated by geopolitical developments and their implications for energy prices and inflation.
Geopolitical risks will remain elevated, as the start of the week remains within the US 48-hour ultimatum window for Iran to reopen the Strait of Hormuz. Headline risks remain elevated in both directions.
Of most interest on the data front this week will be the S&P preliminary PMIs for key developed markets at the start of March. These releases may provide some of the first indications of how the conflict is beginning to impact business activity, pricing, and sentiment.
There will also be several important CPI reports for Japan, Aus, and the UK for Feb.
Key factors & events to watch this week:
S&P Prelim PMI’s for March
- While it may be too early for a broad view, the PMI reports may provide some of the first insights into business impacts as the conflict began. Specifically: prices, business outlook sentiment, and supply chain impacts.
FOMC speeches
There will be several Fed speeches this week. Of note will be Vice Chair Jefferson speaking on the Economic Outlook and Energy Effects on 26 Mar. Governor Barr will also speak on the Economy on the same day. Other scheduled speeches will be noted in the calendar.
Global CPI reports – Feb
- Japan: National Core CPI ex fresh food is expected to slow to +1.7% in Feb, from +2% in Jan.
- Australia: Headline CPI is expected to be unchanged at +3.8% in Feb.
- UK: Headline CPI is expected to be unchanged at +3% in Feb, while core CPI is also expected to be unchanged at +3.1% in Feb.
This week, the US Treasury will auction and settle approx $518bn in ST Bills & FRNs, raising approx. $1bn in new money. Approx $14bn in ST Bills will mature on the Fed balance sheet and will be reinvested. The US Treasury will also auction the 2-year, 5-year, and 7-year Notes this week – to settle on 31 Mar/next week.
More detail (including a calendar of key data releases) is provided in the briefing document – download the pdf below:
Comments and feedback are welcome. Please email me at kim.mofardin@marscapitalpartners.net
by Kim | Mar 16, 2026
The key events for the w/c 16 March 2026: Central Bank meetings: RBA, BoC, FOMC, BoJ, SNB, BoE, and ECB; US PPI; Aus Labour market; Canada CPI
Macro Recap: The Threat of a Persistent Conflict
Geopolitical Risks
The conflict in the Middle East and the resulting closure of the Strait of Hormuz remain the primary drivers of sentiment. The drift back up in oil prices through the end of last week suggests “conflict duration risk” remains a primary concern. If the conflict becomes more entrenched (and the Strait remains closed), the structural threat to global energy distribution and production may become harder for markets to “look through.” The current uncertainty over the duration of this conflict presents a difficult trade-off for key central bank meetings this week: the longer the conflict lasts, the greater the risk that elevated energy prices un-anchor inflation expectations, squeeze real incomes, and weigh on global growth.
U.S. Macro: A Slower Starting Block
Last week, the US GDP revision for Q4 suggested that growth in 2025 ended on a softer-than-expected note. However, growth was expected to slow in Q4 (despite the much higher tracking of growth ahead of official results), due to the effects of the US government shutdown. The “second estimate” of US GDP growth in Q4 was revised notably lower from 1.4% to 0.7% annualized. While most areas of expenditure contributed to the growth downgrade in Q4, the largest contributions were from personal spending and net exports. Overall in Q4, the largest contributors to the slowdown in growth in Q4 versus Q3 were from slower personal consumption expenditure growth, a contraction in net exports, and the decline in government expenditure.
US Q1 Momentum and the Consumer
Looking ahead, the Atlanta Fed’s GDP Nowcast for Q1 2026 growth remains at a resilient +2.7%. However, momentum cooled following last week’s data releases. While a negative Feb labor report weighed on personal spending estimates, this was partially offset by constructive data in housing starts and existing home sales. Personal income growth strengthened in Jan, but growth in real spending remained low. This suggests that softer personal consumption growth has so far persisted into the current quarter, just as higher energy prices threaten a further squeeze on real incomes.
The Inflation Baseline
Importantly for the outlook, the Fed’s preferred PCE inflation data provided a mixed baseline. Headline inflation edged lower to +2.8% over the year, but core PCE ticked up to 3.1% in Jan. Both headline and core PCE inflation are higher than a year ago – reflecting a stickier inflation profile leading into a period of potentially higher energy prices. While the firming trend in core goods and core services inflation remains a concern, the median and the trimmed mean, to a lesser extent, suggest that underlying price pressures likely did not broaden out this month. The more current CPI report for Feb came in as expected, remaining lower at +2.4% for headline and +2.5% for core, and the upcoming PPI for Feb this week will help gauge the read-through to the Feb PCE result.
Outlook for the week ahead: Central Bank meetings: RBA, BoC, FOMC, BoJ, SNB, BoE, and ECB; US PPI; Aus Labour market; Canada CPI
The week ahead is defined by an unusual calendar alignment among central bank meetings, with at least seven key institutions scheduled to meet. These banks are facing elevated uncertainty over the duration of the current conflict and its subsequent impact on energy prices and inflation. Consequently, policymakers will need to reconcile these global pressures with their respective domestic policy nuances as they navigate yet another shock in this cycle of elevated uncertainty.
There will also be several key data releases, and markets are likely to remain firmly focused on the conflict and energy markets. Headline risks remain elevated in both directions.
Key factors & events to watch this week:
Central Bank Meetings
Most central banks are expected to stay on hold in a “wait-and-see” approach for now, due to uncertainty over the duration and scope of the conflict and its resulting impact on energy prices and inflation. Many markets were expecting policy easing through the remainder of the year; however, policymakers will be cognizant of the shift in market pricing for the path of ST rates – in some cases, shifting toward the prospect of hikes this year, as the risk of a prolonged conflict could see higher energy prices derail inflation progress. For most central banks, it will be too early to tell. However, signalling their commitment to inflation mandates may be an important part of central bank decisions this week to keep inflation expectations anchored amid the uncertainty. We will continue to track the signalling by central banks on the outlook and for shifts in guidance.
RBA
- Not all central banks are expected to stay on hold. The RBA will be first cab off the rank this week, and markets are expecting the chance of another hike (back-to-back), taking the cash rate from 3.85% to 4.1%.
- Inflation was (already) the immediate policy risk at its meeting in Feb leading the RBA to hike rates by 25bps.
- Guidance had been suspended at the last meeting in Feb due to the uncertainty over the persistence of domestic inflation pressures.
BoC
- The BoC is expected to stay on hold. The Bank is expected to remain cautious over inflation pressures as the economy adjusts through this period of ‘structural change’.
- Similarly, given the uncertainty facing the Canadian economy over the impacts from tariffs and especially the upcoming renegotiation of the USMCA, guidance had been suspended at the last meeting to provide the Bank with maximum optionality.
FOMC
- The FOMC is expected to stay on hold at this meeting. Market pricing for the path of rates has shifted notably in the last two weeks, now pricing in one cut through the next year.
- The FOMC faces a challenge over balancing its dual mandate – with PCE inflation remaining stickier, and concerns over the labor market rising after the Feb labor report.
- Fed communication will be in focus.
- Updated projections (SEP) will be released at this meeting, and the path of rates and the shift in the projections for growth, inflation, and unemployment will be important signalling.
- Changes to dissents will show how aligned members are – there were two last time.
- The press conference will enable Chair Powell to expand on how they are thinking about this latest shock, and he’ll have to walk a fine line about ‘looking through’ another inflation shock.
BoJ
- The BoJ is expected to stay on hold at this meeting.
- Bank communication will be important for the outlook for hikes – prior guidance was signalling an expectation for further hikes, and markets are still (potentially) expecting a hike in Apr.
BoE
- The BoE is now also expected to stay on hold, shifting from an expectation for a cut at this meeting.
- Recent data continues to reflect easing in growth and labour market conditions, while inflation, although still elevated, has continued to ease. At the last meeting, the BoE noted that “the risk of greater inflation persistence is now less pronounced”. At the same time, concerns emerged over slower inflation risks from weakening demand and a looser labour market.
- The decision to stay on hold, and any changes to the inflation outlook, will need to be reconciled with the prior guidance that “Bank Rate is likely to be reduced further”.
ECB
- The ECB is also expected to stay on hold at this meeting.
- Guidance is unlikely to be changed from the current ‘meeting by meeting’ approach – although the timeframe for the outlook is likely to be shortened, given the elevated uncertainty over energy prices, especially for Europe.
Geopolitical Risks
Geopolitical risks are expected to remain elevated as markets grapple with the uncertain trajectory and scope of the conflict.
Global Data
- US: headline PPI for Feb is expected to slow to +0.3% over the month in Feb (from +0.5% in Jan), and increase to +3% over the year (from +2.8% in Jan). Core PPI is expected to slow to +0.3% over the month in Feb (from +0.8% in Jan), but also accelerate to +3.7% in Feb (from +3.6% in Jan).
- Canada: CPI for Feb is expected to firm over the month for headline inflation (+0.7% in Feb from 0% in Jan) and remain little changed at around +2.3% over the year. The median inflation rate is expected to continue easing to +2.4% in Feb from +2.5% in Jan.
- Australia: Labour Market Survey for Feb is expected to remain fairly stable with +20k employment growth in Feb (up from +17k in Jan) while the unemployment rate ticks slightly higher to 4.2% (from 4.1% in Jan).
This week, the US Treasury will auction and settle approx $679bn in ST Bills, Notes, and Bonds, raising approx. $96bn in new money. Approx $26bn in ST Bills will mature on the Fed balance sheet and will be reinvested. The US Treasury will also auction the 10-year TIPS and 20-year Bond this week – both to settle at the end of the month.
More detail (including a calendar of key data releases) is provided in the briefing document – download the pdf below:
Comments and feedback are welcome. Please email me at kim.mofardin@marscapitalpartners.net
