On Friday (15:30 GMT+3), markets will pay attention to the Personal Consumption Expenditure (PCE) Price Index, the metric the Federal Reserve prefers to gauge the inflation level. According to forecasts, the annual Core PCE declined to 3.7% in September, compared to 3.9% the month before. Still, the Fed targets an average inflation rate of 2%. Analysts expect that the Core PCE MoM level rose 0.3% in September, up from 0.1% in August. The Fed is in its blackout period this week, ahead of the meeting scheduled for October 31-November 1. According to the CME FedWatch Tool, there is a 98.5% chance the central bank will keep the interest rate on hold at the current 525-550 bps level. A significant deviation from the forecast may lead to increased volatility in US markets.
This week, traders will closely monitor earnings reports from four of the so-called "Magnificent Seven'' stocks that include Microsoft, Amazon, Alphabet, and Meta. These stocks pushed the S&P 500 index higher this year. Alphabet and Microsoft will report on Tuesday, Meta will announce its quarterly results on Wednesday, and Amazon will present its results on Thursday. Better-than-expected data may boost the leading US stock indices.
US GDP growth will be tracked by traders on Thursday (15:30 GMT+3). According to the forecasts, the GDP growth rate in the third quarter increased to 4.2%, up from 2.1% in the second quarter, due to stronger-than-expected gains in exports, consumer spending, and employment. Enormous growth may lead to the appreciation of the US dollar.
The economic calendar doesn’t list crucial events for the oil market. On Wednesday, markets may check the weekly EIA Crude Oil Inventories report (17:30 GMT+3). However, the main focus will be on developments in the Middle East. Geopolitical tensions keep creating enormous volatility, including in the oil market.
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