This week, financial markets are set to be dominated by a series of central bank decisions that could reshape investor sentiment worldwide. Following last week’s European Central Bank update, attention now shifts to the U.S. Federal Reserve, Bank of England, Bank of Japan, and several others including those in Canada and Taiwan.The Fed meets against the backdrop of legal challenges to its leadership and efforts to confirm President Donald Trump’s nominee to the Board of Governors. Markets expect a 25-basis-point rate cut on Wednesday, while the likelihood of a sharper 50 bps reduction has eased to 3.8%, according to CME FedWatch.Asian equities started the week quietly, with Japanese markets closed for a holiday. South Korea’s Kospi hit a record high after the government reversed plans for higher capital gains taxes. European futures showed mixed movement, while U.S. S&P 500 e-minis edged up 0.1% ahead of Friday’s Triple Witching.
On the political front, the U.S. and UK are preparing agreements on technology and nuclear energy during Trump’s state visit, as London pushes for progress on steel tariffs within a wider trade deal. Meanwhile, U.S. and Chinese officials resumed trade negotiations in Madrid, with Trump signaling flexibility over TikTok’s divestiture deadline.China’s economic data reflected slowing momentum in August, with industrial output at 5.2% and retail sales rising only 3.4%. Adding to concerns, toy-maker Pop Mart’s shares fell nearly 9% after J.P. Morgan downgraded the stock, warning of weak visibility for future product launches.With rate decisions, trade negotiations, and economic signals all converging, investors are bracing for a volatile week across global markets.
Markets Await Fed’s Rate Call as Global Central Banks Take the Stage
