What Are The Main Events For Today?

EUROPEAN SESSION

In the European session, we don't have much on the agenda other than the Swiss PPI report. The data won't change anything for the SNB, so the market reaction will likely be muted. 

The focus is currently on oil prices, with WTI and Brent both trading above the $100 level amid disruptions in the Strait of Hormuz, Bab-el Mandeb and increased supply concerns after Saudi Arabia shut a key oil pipeline following drone attacks. 

Looking ahead, the developments in the Middle East and the FOMC rate decision on Wednesday are going to be key for markets. 

AMERICAN SESSION

In the American session, the only highlight is the Canadian CPI report. Headline CPI Y/Y is expected at 3.0% vs 3.0% prior, while the Trimmed-Mean CPI (the core measure the BoC focuses on) is seen at 1.9% vs 1.9% prior. 

As a reminder, the BoC surprised at the last policy meeting delivering a more hawkish than expected decision. The central bank removed the reference to the policy rate being "appropriate" and downplayed tariffs headwinds as businesses adapted. Since then, we got a soft Canadian employment report, with -41.7K job cuts in August and a much lower than expected wage growth at 2.0% y/y. 

The only thing that's been keeping rate hike expectations alive is surging oil prices. The market is currently pricing in a 56% chance of a hike in October and a total of 128 bps of tightening by the end of 2027. 

CENTRAL BANK SPEAKERS

• 09:15 GMT/05:15 ET - ECB's Schnabel (hawkish - voter)
• 13:00 GMT/09:00 ET - ECB's Cipollone (neutral - voter)
• 15:15 GMT/11:15 ET - ECB President Lagarde (hawkish - voter)