Week Ahead: Economic Indicators 5th – 9th October (US)

Monday 5th October
09:45 ET
US S&P Services PMI September Final
The S&P Global US Services PMI measures business activity across the US service sector, covering areas including financial services, technology, transportation, communication and consumer-facing businesses. A reading above 50 indicates expansion, while a reading below 50 indicates contraction. Markets focus on the headline Business Activity Index alongside new business, employment, backlogs, input costs and selling prices, with services inflation particularly relevant for assessing underlying inflation pressures.

Summary of Last Report
In the September Preliminary survey, US service-sector activity accelerated sharply, with growth reaching its strongest pace since July 2021. The strength in services helped lift the broader Composite PMI to 58.4 from 56.0 in August, signalling the fastest overall expansion in US private-sector activity for more than five years.
The preliminary report showed:
– Services activity growth accelerated to its strongest since July 2021, considerably outperforming other major developed economies.
– New business continued to expand strongly as firms reported resilient customer demand.
– Employment across manufacturing and services increased at the fastest pace since June 2022, as companies added staff to meet stronger demand.
– Capacity pressures intensified despite stronger hiring, with backlogs of work rising at the fastest rate since May 2022.
– Input-cost inflation accelerated to its highest in nearly four years, with businesses highlighting rising fuel and transportation costs alongside capacity constraints.
– Selling-price inflation also accelerated from August, although competitive pressures limited price increases in parts of the service sector.
– Business expectations remained positive, although confidence among service providers continued to run below its historical average amid concerns around borrowing costs, the cost of living and broader uncertainty. S&P Global
Overall, the preliminary September survey showed a substantial acceleration in services activity accompanied by stronger hiring and renewed inflation pressure. S&P Global estimated that the September Composite PMI was consistent with economic growth running at roughly a 5% annualized pace during the month.

What to Expect
US Stocks
Confirmation of strong services growth would reinforce evidence that the US economy entered the end of Q3 with considerable momentum, potentially supporting cyclical and consumer-sensitive equities. However, further upward revisions to employment or price pressures could weigh on rate-sensitive stocks by strengthening expectations for tighter monetary policy.
US Dollar
An upward revision to the September Services PMI, particularly alongside stronger employment and price components, would likely support the dollar by reinforcing the relative strength of the US economy. A meaningful downward revision could pressure the dollar, although the preliminary survey leaves a relatively high bar for the final reading to materially alter the broader growth picture.
US Government Bond Yields
Treasury yields could rise if the final report confirms exceptionally strong services activity alongside accelerating input and selling prices. A downward revision accompanied by weaker employment or softer price pressures would likely be more supportive for Treasuries.
Federal Reserve Policy
The Fed will likely pay particular attention to the combination of services activity, employment and inflation pressures. The September preliminary survey showed activity accelerating to its strongest since July 2021, employment growth reaching a more than four-year high and input costs increasing at their fastest pace in nearly four years. S&P Global described the combination as delivering a distinctly hawkish signal for interest rates. S&P Global
Confirmation of those trends in the final survey would reinforce the case for maintaining a restrictive policy stance, particularly if services selling prices accelerate further. A meaningful downward revision to activity combined with softer employment and price pressures would reduce some of that signal, although the preliminary data indicate that the service sector remained exceptionally resilient during September.

10:00 ET
US ISM Services PMI for September
The ISM Services PMI measures business conditions across the US services sector using surveys of purchasing and supply executives. A reading above 50 indicates expansion, while a reading below 50 indicates contraction. Markets focus on the headline PMI alongside Business Activity, New Orders, Employment and Prices, with the latter two particularly important for assessing labour-market conditions and inflationary pressure across the services economy.

Summary of Last Report
In the previous report (August), the ISM Services PMI rose to 55.4 from 54.1 in July, marking the 26th consecutive month of expansion. Business Activity and New Orders strengthened considerably, while employment remained in contraction and the Prices Index climbed to its highest level in four years. Institute for Supply Management
The report showed:
– Services PMI increased to 55.4 from 54.1, indicating a faster pace of expansion.
– Business Activity jumped to 61.7 from 59.1, its strongest reading since February 2022.
– New Orders rose sharply to 60.9 from 57.2, signalling a significant acceleration in demand.
– Employment remained in contraction at 47.8, although this was slightly higher than July’s 47.4.
– Prices Paid increased to 72.6 from 70.3, reaching its highest level since August 2022.
– Supplier Deliveries fell to 51.3 from 52.8, indicating deliveries continued to slow, but at a reduced pace.
– Backlog of Orders rose to 55.6 from 50.9, its seventh consecutive month in expansion.
– New Export Orders increased to 56.3 from 52.0, while Imports also rose to 56.3 from 51.8.
– Twelve services industries reported growth during August, while five reported contraction. Institute for Supply Management
Overall, August showed strong service-sector demand but a notable divergence between activity and employment. Business Activity and New Orders were particularly strong, while the Employment Index remained below 50 for a second consecutive month. At the same time, the rise in Prices Paid to 72.6 highlighted persistent and intensifying cost pressures. Institute for Supply Management

What to Expect
US Stocks
A strong September reading supported by Business Activity and New Orders could reinforce confidence in the resilience of the US economy and support cyclical and consumer-sensitive equities. However, another elevated Prices reading could limit the positive reaction by strengthening expectations for restrictive monetary policy. A significant deterioration in activity and orders would instead raise concerns about growth.
US Dollar
A stronger-than-expected Services PMI would likely support the dollar, particularly if accompanied by improving Employment and persistent price pressures. A sizeable downside surprise, especially alongside weaker New Orders and Employment, could pressure the dollar by signalling that momentum in the dominant US services sector is fading.
US Government Bond Yields
Treasury yields could rise if September confirms strong services demand alongside another elevated or rising Prices Index. August’s 72.6 Prices reading was the highest since August 2022, making this component particularly important. Institute for Supply Management A weaker activity reading accompanied by easing prices would likely pull yields lower.
Federal Reserve Policy
The Fed will be watching whether August’s strong demand indicators begin to translate into stronger hiring or additional inflation pressure. August produced an unusual combination of Business Activity at 61.7 and New Orders at 60.9 while Employment remained in contraction at 47.8. Meanwhile, Prices Paid rose to 72.6 and has remained above 60 for 21 consecutive months. Institute for Supply Management
A September report showing continued strong activity, a rebound in Employment and persistent price pressure would reinforce the case for maintaining restrictive policy. A slowdown in New Orders and Business Activity combined with continued employment weakness and a meaningful decline in Prices would instead provide evidence that both services demand and inflation pressure are beginning to cool.

Tuesday 6th October
08:30 ET
US Trade Balance For August
The US Trade Balance, published jointly by the Bureau of Economic Analysis and Census Bureau, measures the difference between the value of US exports and imports of goods and services. A deficit occurs when imports exceed exports. Markets watch the report for evidence of changes in domestic and overseas demand, while movements in real exports and imports can also influence estimates of GDP growth.

Summary of Last Report
In the previous report (July), the US goods and services trade deficit widened sharply to $88.6 billion from a revised $71.2 billion in June. The deterioration reflected a combination of falling exports and rising imports. Bureau of Economic Analysis
The report showed:
– Trade deficit: $88.6 billion, widening by $17.4 billion from June.
– Exports fell 2.1% to $310.7 billion, a decline of $6.6 billion.
– Imports rose 2.8% to $399.3 billion, increasing by $10.8 billion.
– The goods deficit widened by $17.6 billion to $119.6 billion.
– The services surplus increased slightly to $31.0 billion.
– Goods exports fell $6.2 billion to $201.0 billion, led by an $8.7 billion decline in industrial supplies and materials, including lower crude oil and nonmonetary gold exports.
– Goods imports increased $11.4 billion to $320.6 billion, with capital goods imports jumping $14.4 billion, driven particularly by computers, computer accessories and semiconductors.
– Real goods exports fell 1.8%, while real goods imports increased 3.8%, causing the real goods deficit to widen by $12.0 billion to $106.4 billion.
– Despite July’s deterioration, the year-to-date trade deficit remained 29.6% smaller than during the same period in 2025, with exports up 12.0% and imports up 1.9%. Bureau of Economic Analysis
Overall, July represented a substantial deterioration in the US trade position, with imports rebounding while exports declined. The surge in capital-goods imports was particularly notable, while the widening real goods deficit suggested trade was becoming a greater drag on economic growth at the beginning of Q3.

What to Expect
US Stocks
A narrower August deficit driven by stronger exports could be supportive for industrial and internationally exposed US companies, particularly if it reflects improving overseas demand. A larger deficit caused by strong imports could have a more mixed interpretation, as it may indicate resilient domestic demand. A widening deficit caused primarily by falling exports would provide a more negative signal for growth.
US Dollar
The immediate dollar reaction is usually limited unless the report produces a significant surprise. Stronger exports and a narrower deficit could provide modest support for the dollar through a stronger growth outlook, while unexpectedly weak exports could weigh on the currency. The underlying drivers of the balance are likely to matter more than the headline deficit alone.
US Government Bond Yields
A narrower deficit accompanied by stronger exports and domestic economic activity could place modest upward pressure on Treasury yields. Conversely, weaker exports and evidence of slowing demand could pull yields lower. Strong imports could complicate the reaction because they subtract from GDP accounting while potentially signalling resilient US domestic demand.
Federal Reserve Policy
The Trade Balance is unlikely to materially change Fed policy by itself, but it contributes to the broader assessment of economic growth and domestic demand. July’s widening real goods deficit, with real exports falling 1.8% and real imports rising 3.8%, pointed toward a larger trade drag on Q3 GDP at the start of the quarter. Bureau of Economic Analysis
A substantial reversal in August, particularly through stronger exports, would improve the Q3 growth picture. Another large widening driven by falling exports would point toward weaker net trade and could reduce estimates of economic growth, while continued import strength would need to be weighed against the potentially positive signal it provides about underlying US demand.

Wednesday 7th October
14:00 ET
FOMC Meeting Minutes for the September Meeting
The FOMC Meeting Minutes provide a more detailed account of the discussions that took place during the Federal Reserve’s September policy meeting. They can reveal how broad support was for the rate decision, how officials viewed inflation and labour-market risks, and how participants interpreted the latest economic data and SEP projections. Because the statement itself was brief, the minutes will be especially useful for understanding the range of views within the Committee.

Summary of Last Meeting
At the September meeting, the Federal Reserve raised the federal funds target range by 25bp to 3.75% to 4.00%, with the decision approved 12 to 0. The statement said economic activity was expanding at a solid pace, domestic spending remained resilient, productivity growth was strong, capital investment was robust, and job gains had kept pace with workforce growth. At the same time, the Fed said inflation remained elevated and that the rate increase would support a timelier return to the 2% target. Federal Reserve
The updated SEP showed a distinctly more hawkish policy path than in June:
– 2026 federal funds rate median: 4.1%, up from 3.8%.
– 2027 median: 4.1%, up from 3.6%.
– 2028 median: 3.9%, up from 3.4%.
– 2026 GDP growth: 2.3%, revised up from 2.2%.
– 2026 unemployment: 4.1%, revised down from 4.3%.
– 2026 PCE inflation: 3.7%, revised up from 3.6%.
– 2026 Core PCE inflation: 3.4%, revised up from 3.3%. Federal Reserve
The projections therefore showed policymakers expecting stronger growth, lower unemployment, slightly higher inflation, and materially higher interest rates than they had projected in June. The September meeting combined a rate hike with a clear upward shift in the projected policy path.

What to Expect
US Stocks
Markets will focus on whether the minutes show that the unanimous rate hike reflected broad conviction that policy needed to tighten further, or whether some officials supported the move only cautiously. Evidence that many policymakers favoured additional hikes could weigh on rate-sensitive equities, while a more divided discussion about the need for further tightening could be more supportive.
US Dollar
Hawkish minutes showing broad support for a higher terminal rate or concern that inflation remains too persistent would likely support the dollar. A more cautious discussion, particularly if several officials expressed concern about overtightening or downside risks to growth, could pressure the dollar.
US Government Bond Yields
Treasury yields could rise if the minutes reinforce the September SEP’s higher projected rate path and reveal that officials discussed further tightening. Front-end yields would be particularly sensitive to any indication that the 4.1% end-2026 median understates how many policymakers would support additional near-term hikes. A more balanced discussion could pull yields lower.
Federal Reserve Policy
The key question will be how strongly the Committee stands behind the September shift toward tighter policy. The SEP moved the projected rate path materially higher, while simultaneously showing stronger growth, lower unemployment, and slightly higher inflation. Federal Reserve
The minutes should help clarify whether policymakers see the September hike as a one-off adjustment, the beginning of a renewed tightening cycle, or simply insurance against inflation remaining above target. Particular attention will fall on discussion around services inflation, wage pressures, resilient domestic demand, productivity, and the balance between inflation and employment risks.
A broad consensus that inflation risks remain dominant would reinforce the case for keeping policy restrictive or tightening further. Evidence that officials are increasingly concerned about the cumulative effects of higher rates would suggest a more cautious approach at subsequent meetings.

Thursday 8th October
No noteworthy economic indicators

Friday 9th October
08:30 ET
Canadian Employment Change for September
The Canadian Labour Force Survey, published by Statistics Canada, provides the primary monthly assessment of employment conditions in Canada. Markets focus on the monthly change in employment, the unemployment rate, labour-force participation, full-time versus part-time employment, and average hourly wages. The composition of employment is particularly important because headline job gains driven by full-time and private-sector hiring generally provide a stronger signal than increases concentrated in part-time or public-sector employment.

Summary of Last Report
In August, Canadian employment fell by 42k, reversing part of the strong employment growth recorded between April and July. The unemployment rate remained unchanged at 6.4%, while wage growth slowed considerably.
The report showed:
– Employment fell by 42k, or 0.2%, following a cumulative increase of 181k between April and July.
– The unemployment rate held at 6.4%, following three consecutive monthly declines between May and July.
– The employment rate fell 0.1pp to 60.8%.
– The participation rate declined 0.1pp to 65.0%, reversing its July increase.
– Employment among youth fell by 19k, while core-aged employment edged down by 16k.
– Manufacturing employment increased by 22k, making it the only industry to record a significant employment increase during the month.
– Employment declined in business, building and other support services by 20k, public administration by 8.8k, natural resources by 7.7k, and utilities by 5.6k.
– Public-sector employment fell by 20k, its third consecutive monthly decline, while private-sector employment and self-employment were little changed.
– Average hourly wages increased 2.0% YoY to C$37.02, slowing sharply from 2.8% in July and 3.3% in June. This was the slowest annual wage growth outside the pandemic period since November 2017. Statistics Canada
Overall, August represented a setback after several months of improving labour-market conditions. However, the unemployment rate remaining at 6.4% and layoffs staying relatively contained suggested the report was more indicative of softer hiring than a significant increase in job losses.

What to Expect
Canadian Stocks
A rebound in September employment could support domestically focused and cyclical Canadian equities by suggesting August’s decline was temporary and that the economic recovery remains intact. A second consecutive employment decline, particularly if accompanied by weaker private-sector or full-time employment, could raise concerns that growth momentum is beginning to fade.
Canadian Dollar (CAD)
Stronger-than-expected employment growth, particularly alongside a lower unemployment rate or firmer wages, would likely support the CAD by reinforcing evidence of economic resilience. Another substantial employment decline or an increase in unemployment could pressure the currency by strengthening expectations for a more accommodative Bank of Canada policy outlook.
Canadian Government Bond Yields
Canadian yields could rise on strong employment growth, particularly if accompanied by stronger wage growth after August’s sharp slowdown. A weak report showing falling employment, rising unemployment and subdued wages would likely pull yields lower as markets price greater labour-market slack.
Bank of Canada Policy
The September report will be important in determining whether August’s 42k employment decline was temporary or marks a renewed deterioration in labour demand. The Bank of Canada has acknowledged that labour-market conditions improved earlier in the summer, but continues to describe demand for labour as subdued and the economy as operating with excess supply.
The Bank held its policy rate at 2.25% in September, balancing continued economic slack against increased upside inflation risks from elevated energy prices and trade-related costs.
A strong September employment rebound, particularly alongside firmer wage growth, would reinforce evidence that the economic recovery remains resilient and reduce the case for additional accommodation. Another weak employment report accompanied by rising unemployment and subdued wages would instead point to greater labour-market slack, although the policy implications would remain dependent on whether elevated energy prices begin feeding more broadly into underlying inflation.

10:00 ET
University of Michigan Sentiment & Inflation Expectations October Prelim
University of Michigan Consumer Sentiment & Inflation Expectations for October Preliminary
The University of Michigan Surveys of Consumers measure household confidence in current economic conditions and expectations for the future, alongside consumers’ expectations for inflation. Markets focus on the headline Consumer Sentiment Index, Current Economic Conditions, Consumer Expectations, and particularly the 1-year and 5-10 year inflation expectations measures.
The October preliminary report will be important for determining whether September’s deterioration in confidence and renewed rise in inflation expectations continued into the new month. The University of Michigan’s September research indicated that both gasoline prices and tariff concerns were contributing to changes in household inflation expectations.

Summary of Last Report
In the September Final report, Consumer Sentiment fell to 48.1 from 51.7 in August, reaching its lowest level in four months. The final reading was slightly stronger than the preliminary estimate of 47.8, but still left sentiment 12.7% below September 2025 levels. SCA
The report showed:
– Consumer Sentiment fell to 48.1 from 51.7 in August.
– Current Economic Conditions declined to 50.9 from 51.9.
– Consumer Expectations fell sharply to 46.3 from 51.5.
– 1-year inflation expectations jumped to 4.6% from 4.0%, their highest level since June.
– 5-10 year inflation expectations increased to 3.4% from 3.3%, ending three consecutive months at 3.3%.
– Sentiment was 15% below its January 2026 level, with consumers reporting worsening views of both current and expected personal finances.
– Concerns about high prices continued to increase, while the short-term outlook for business conditions deteriorated amid worries surrounding elevated fuel prices and renewed trade disputes. SCA
Overall, September produced an unfavourable combination of weaker consumer confidence and higher inflation expectations. The deterioration was particularly pronounced in expectations, while the increase in both short and long-term inflation expectations suggested consumers were becoming more concerned about persistent price pressures.

What to Expect
US Stocks
A rebound in October sentiment accompanied by lower inflation expectations would likely be the most supportive combination for equities, suggesting household confidence is stabilising without creating additional inflation concerns. Another deterioration in sentiment could raise concerns about future consumer spending, while a further increase in inflation expectations could pressure rate-sensitive stocks through a more restrictive Fed outlook.
US Dollar
The dollar is likely to be particularly sensitive to the inflation expectations components. Another increase in 1-year expectations, especially if accompanied by a further rise in the 5-10 year measure, could support the dollar by reinforcing expectations for restrictive monetary policy. Falling inflation expectations combined with weaker sentiment could instead pressure the currency.
US Government Bond Yields
Treasury yields could rise if October shows another increase in household inflation expectations, particularly in the longer-term measure. A reversal of September’s increase would likely be more supportive for Treasuries, especially if accompanied by another deterioration in consumer confidence.
Federal Reserve Policy
The Fed will likely place greater weight on the inflation expectations measures than modest movements in headline sentiment. September saw 1-year expectations rise sharply from 4.0% to 4.6%, while long-run expectations increased from 3.3% to 3.4%. Both remained elevated relative to 2024 levels, when long-run expectations ranged between 2.8% and 3.2%.
A further rise in October, particularly in the 5-10 year measure, would increase concerns that elevated inflation is becoming more embedded in household expectations and reinforce the case for restrictive policy. A decline in both measures would provide greater reassurance that September’s increase was temporary, particularly if fuel-related inflation concerns begin to ease.