Policy decisions by the Federal Reserve, the Bank of Japan and the Bank of England are concentrated this week, with inflation indicators and wage data expected to raise the likelihood of rate hikes.
The US FOMC is scheduled to hold its policy meeting on the 15th and 16th, the Bank of Japan on the 17th and 18th, and the Bank of England on the 17th. Announcements from the three major central banks could affect the direction of global monetary policy.
The core US CPI index for August, released on the 11th, rose 0.3% month on month, exceeding market expectations and strengthening expectations that FOMC participants will raise interest rates. This has led to growing expectations of an increase in the target range for the federal funds rate.
Nominal wages rose 4.7% year on year in July, showing strong growth, and the data indicating continued wage increases have fueled expectations that rising wages will support an additional rate hike by the Bank of Japan.
Market expectations are widespread that the Bank of Japan will raise its policy rate from around 1.0% to around 1.25%, while the outlook for a Bank of England rate hike is considered weak.