Tomorrow's Macro Roadmap: Japan's Inflation Seen Rising to 2.1% From 1.9% a Week Before the BoJ Decides
Friday, 23 October 2026 — Economists expect Japan's inflation to rise to 2.1% in September from 1.9% in August, with the national figures due at 01:30 CET, a week before the Bank of Japan's 29-30 October meeting.
Our three themes for tomorrow:
The first is Japan's inflation. Economists expect the national figures for September to show inflation rising to 2.1% from 1.9%, a week before the Bank of Japan's 29-30 October meeting. Tokyo's figures, published a month earlier, showed the measure excluding fresh food and energy jumping to 3.0% from 2.0%. Swap traders see almost no chance of a rate hike on 30 October but assign a 71% chance in December.
The second is the UK consumer. Economists expect retail sales volumes to fall 0.1% in September after a 0.5% rise in August, two days after inflation rose to 3.5% from 3.1%. With swap traders assigning a 96% chance of a Bank of England rate hike on 5 November, the report is more likely to shape bets on a second hike than the November decision.
The third is consumers' inflation expectations. The ECB's survey is expected to show the median 12-month forecast at 3.1%, up from 3.0%. The University of Michigan's final October survey follows with a preliminary year-ahead reading of 4.7% (no consensus available), the highest since May, according to the university. Both central banks are watching whether the energy shock feeds into expectations, with swap traders assigning a 74% chance of an ECB rate hike in December and 77% for the Federal Reserve.
Chart of the day: Japan's inflation is expected to pick up to 2.1%
In brief
01:30 CET · Natl CPI YoY (Sep): consensus 2.1%, previous 1.9%
01:30 CET · Natl CPI Ex Fresh Food YoY (Sep): consensus 2.1%, previous 1.7%
08:00 CET · Retail Sales Inc Auto Fuel MoM (Sep): consensus -0.1%, previous 0.5%
08:00 CET · Retail Sales Inc Auto Fuel YoY (Sep): consensus 1.0%, previous 2.4%
10:00 CET · ECB 1 Year CPI Expectations (Sep): consensus 3.1%, previous 3.0%
10:00 CET · ECB 3 Year CPI Expectations (Sep): consensus 2.9%, previous 2.9%
16:00 CET · U. of Mich. Sentiment (Oct F): consensus 46.3, previous 46.3
16:00 CET · U. of Mich. 1 Yr Inflation (Oct F): previous 4.7%
Scenarios
Japan: National CPI (Sep) (01:30 CET, Medium impact): Economists expect 2.1% after 1.9%, with the measure excluding fresh food and energy at 2.3%. A reading near Tokyo's 3.0% for that measure could lift two-year JGB yields and the yen and firm the 71% chance of a BoJ rate hike priced for December.
United Kingdom: Retail sales (Sep) (08:00 CET, Medium impact): Economists expect a 0.1% fall after a 0.5% rise. A weak report is unlikely to move the 96% chance of a November hike but could trim the 40% priced for a second move in December and weigh on sterling.
Euro area: ECB Consumer Expectations Survey (Sep) (10:00 CET, Low impact): Economists expect the 1-year median at 3.1% from 3.0%. A rise in the 3-year median above the consensus of 2.9% would point to second-round risk and could lift short-dated yields in the euro area and the euro.
United States: University of Michigan final October survey (16:00 CET, Medium impact): Economists expect sentiment at 46.3. A year-ahead inflation expectation above the preliminary 4.7% could lift two-year Treasury yields and the dollar, with a 77% chance of a Fed hike priced for December.
Euro area: Cipollone on the digital euro (16:00 CET, Low impact): The conversation falls inside the quiet period and is billed on payments, not policy, so it is unlikely to move euro pricing.
Speakers
Scheduled speakers: Patrick Montagner (ECB Banking Supervision, 09:55 CET); Piero Cipollone (European Central Bank, 16:00 CET).
The full preview
Data release previews
Japan publishes its national consumer price index (CPI) for September at 01:30 CET.
Economists expect CPI inflation at 2.1% from 1.9%, inflation excluding fresh food at 2.1% from 1.7%, and inflation excluding fresh food and energy at 2.3% from 1.9%.
Tokyo's consumer prices, published about a month before the national figures, rose 2.7% in September, with inflation excluding fresh food also at 2.7%. The Tokyo measure excluding fresh food and energy jumped to 3.0% from 2.0% in August.
On 18 September, the Bank of Japan raised its policy rate to 1.25% in a 7-2 vote. It said underlying inflation has been approaching 2% and that it will continue to raise the policy rate.
In its July Outlook Report, the Policy Board's median forecast put inflation excluding fresh food at 2.5% for the fiscal year to March 2027, against 1.7% in August.
Most houses look for a broad pick-up led by core goods and services, as higher petroleum product prices and the earlier fall in the yen pass through to consumers.
One house points to the first five-day September holiday in 11 years, which lifts accommodation charges, package tour prices and airfares, while lower rice prices offset broader food increases.
On energy, one house sees the phase-out of utility subsidies already lifting the September figure, while another argues that the larger energy effect comes from November, when electricity and gas subsidies end.
Most forecasters expect the Bank of Japan to leave rates unchanged on 30 October and to raise them in December or early next year. One house argues that the Board may judge underlying inflation to have effectively reached its target.
Bloomberg survey: median 2.1%, range 1.9% to 2.8% (as of 22-10-2026).
BoJ market pricing as of 22-10-2026, 17:27 CET:
30 Oct: implied 1.23%, +1 bp priced, 2% (hike) probability of a move
18 Dec: implied 1.41%, +18 bp priced, 71% (hike) probability of a move
22 Jan: implied 1.50%, +27 bp priced, 34% (hike) probability of a move
18 Mar: implied 1.65%, +42 bp priced, 63% (hike) probability of a move
1 basis point priced for 30 Oct, a 2% probability of a 25 basis point rise, and 18 basis points cumulatively by 18 Dec.
Changes are measured from today's effective rate of 1.23%. The policy rate is 1.25%.
Editor's Note: Tokyo's jump to 3.0% in the measure excluding fresh food and energy points to upside risk to the 2.3% consensus for the national CPI measure, and the survey range already runs to 2.8%. A national reading near Tokyo's would support the Board's view that underlying inflation is approaching 2%, and could lift two-year government bond yields and support the yen. Swap traders assign a 71% chance of a rate hike at the 18 December meeting and only 2% on 30 October. A firm print is therefore more likely to harden December bets than to bring the move forward.
The Office for National Statistics publishes UK retail sales for September at 08:00 CET.
Economists expect volumes including fuel to fall 0.1% on the month after a 0.5% rise in August, with the annual rate at 1.0% from 2.4%.
Excluding fuel, sales are expected to fall 0.1% on the month after a 0.6% rise, with the annual rate at 1.4% from 2.7%.
In August, department stores recovered from stock problems and online retailers partly rebounded, while fuel volumes fell as prices rose sharply. Volumes rose 0.9% in the three months to August.
On Wednesday, consumer price inflation rose to 3.5% in September from 3.1%, with core inflation at 2.8% and motor fuels the largest upward contributor.
Most houses expect a small fall, as renewed inflation and higher energy costs and interest rates weigh on spending, while one expects a flat month or a small rise.
Another house notes that consumer spending has stayed resilient so far, with core sales volumes on track for 1.7% growth in the third quarter.
One house argues that the bigger squeeze on real incomes and spending comes around the turn of the year, when energy prices and inflation rise further.
Most forecasters expect the Bank of England to raise Bank Rate to 4.00% from 3.75% on 5 November, its first hike in more than three years.
Bloomberg survey: median -0.1%, range -0.6% to 1.2% (as of 22-10-2026).
BoE market pricing as of 22-10-2026, 17:27 CET:
5 Nov: implied 3.97%, +24 bp priced, 96% (hike) probability of a move
17 Dec: implied 4.07%, +34 bp priced, 40% (hike) probability of a move
4 Feb: implied 4.28%, +55 bp priced, 84% (hike) probability of a move
18 Mar: implied 4.43%, +69 bp priced, 57% (hike) probability of a move
24 basis points priced for 5 Nov, a 96% probability of a 25 basis point rise, and 34 basis points cumulatively by 17 Dec.
Changes are measured from today's effective rate of 3.73%. The policy rate is 3.75%.
Editor's Note: With swap traders assigning a 96% chance of a Bank of England rate hike on 5 November, weak retail sales are unlikely to change that decision. They could, however, temper bets on a second hike, priced at 40% for December. Sales near the 1.2% top of the survey range would add to evidence of resilient demand and could lift two-year gilt yields and sterling. A 0.6% fall, the bottom of the range, would suggest higher prices are already biting into spending ahead of the Budget on 28 October.
The European Central Bank publishes its Consumer Expectations Survey for September at 10:00 CET.
Economists expect the median 1-year inflation expectation at 3.1% from 3.0%, and the 3-year expectation unchanged at 2.9%.
In August, the median expectation for the next 12 months rose to 3.0% from 2.9%, for three years ahead to 2.9% from 2.7% and for five years ahead to 2.5% from 2.4%. Uncertainty about inflation over the next 12 months eased but stayed above its level before the conflict in the Middle East.
The 12-month median jumped to 4.0% in March and April from 2.5% in February, after the start of the conflict, before easing to 2.9% in July.
Euro-area inflation rose to 3.8% in September from 3.2% in August, with energy the largest contributor. The ECB raised its deposit rate to 2.50% in September, its second hike this year after June.
One house notes that consumers' inflation expectations have closely tracked energy prices this year, pointing to a renewed rise at least at the one-year horizon. It argues that a sharper rise could prompt a policy response, because the ECB's priority is to limit second-round effects.
Most forecasters expect the ECB to hold on 29 October and to raise rates in December. One house argues that limited evidence of second-round effects favours a quarterly pace.
Bloomberg survey: median 3.1%, range 3.1% to 3.2% (as of 22-10-2026).
ECB market pricing as of 22-10-2026, 17:27 CET:
29 Oct: implied 2.45%, +1 bp priced, 3% (hike) probability of a move
17 Dec: implied 2.63%, +19 bp priced, 74% (hike) probability of a move
4 Feb: implied 2.71%, +27 bp priced, 33% (hike) probability of a move
18 Mar: implied 2.86%, +42 bp priced, 59% (hike) probability of a move
1 basis point priced for 29 Oct, a 3% probability of a 25 basis point rise, and 19 basis points cumulatively by 17 Dec.
Changes are measured from today's effective rate of 2.44%. The policy rate is 2.50%.
Editor's Note: Swap traders assign a 74% chance of an ECB rate hike on 17 December and 3% on 29 October, so the survey bears on the December decision. A 1-year median at the 3.2% top of the survey range, or a 3-year median above 2.9%, would suggest the energy shock is reaching consumers' longer-term views, the second-round risk policymakers say they are watching. That could firm December bets and lift two-year Bund yields and the euro. A steady reading would support a quarterly pace.
The University of Michigan publishes its final October survey of US consumers at 16:00 CET.
Economists expect the sentiment index at 46.3, unchanged from the preliminary reading, and the expectations index at 47.0 from 47.3.
The current conditions index is expected at 44.7, and 5-10 year inflation expectations at 3.5%, both unchanged from the preliminary survey. Year-ahead inflation expectations stood at 4.7%.
In the preliminary survey, sentiment fell to 46.3 from 48.1 in September, current conditions fell to 44.7 from 50.9, and expectations rose to 47.3 from 46.3.
Year-ahead inflation expectations rose to 4.7% from 4.6%, and long-run expectations rose to 3.5% from 3.4%, the university said, their highest readings since May. The survey's director said frustration over the cost of living continues to mount.
Most houses expect the final figures to confirm the preliminary readings.
One house argues that sentiment needs relief at the petrol pump and lower borrowing costs to improve, with petrol averaging $4.33 a gallon in mid-October. Another looks for a small further dip, after current conditions drove the preliminary decline.
Bloomberg survey: median 46.3, range 45.5 to 47.1 (as of 22-10-2026).
Fed market pricing as of 22-10-2026, 17:27 CET:
28 Oct: implied 3.90%, +2 bp priced, 9% (hike) probability of a move
9 Dec: implied 4.09%, +22 bp priced, 77% (hike) probability of a move
27 Jan: implied 4.19%, +31 bp priced, 37% (hike) probability of a move
17 Mar: implied 4.35%, +47 bp priced, 65% (hike) probability of a move
2 basis points priced for 28 Oct, a 9% probability of a 25 basis point rise, and 22 basis points cumulatively by 9 Dec.
Changes are measured from today's effective rate of 3.88%. The target range is 3.75-4.00%.
Editor's Note: The survey's inflation expectations matter more than the Michigan sentiment index itself. A year-ahead reading of 4.8% or more would match this year's May high. With the Federal Reserve in its blackout before the 27-28 October meeting, such a reading could add to the 77% chance of a rate hike priced for 9 December and lift two-year Treasury yields. A downward revision in long-run expectations from 3.5% would ease that pressure.
Also on the calendar
00:00 CET · Australia · S&P Global Australia PMI Composite (previous 51.3)
00:00 CET · Australia · S&P Global Australia PMI Mfg (previous 49.6)
00:00 CET · Australia · S&P Global Australia PMI Services (previous 51.9)
01:01 CET · United Kingdom · GfK Consumer Confidence (consensus -14, previous -13)
02:30 CET · Japan · S&P Global Japan PMI Composite (previous 52.3)
02:30 CET · Japan · S&P Global Japan PMI Mfg (previous 54.1)
02:30 CET · Japan · S&P Global Japan PMI Services (previous 51.3)
07:30 CET · Japan · Nationwide Dept Sales YoY (previous 2.6%)
07:30 CET · Japan · Tokyo Dept Store Sales YoY (previous 5.7%)
09:30 CET · Germany · S&P Global/BME Germany Manufacturing PMI (consensus 53.5, previous 53.9)
09:30 CET · Germany · S&P Global Germany Services PMI (consensus 52.5, previous 52.9)
09:30 CET · Germany · S&P Global Germany Composite PMI (consensus 53.4, previous 53.8)
10:00 CET · Euro Area · S&P Global Eurozone Manufacturing PMI (consensus 52.8, previous 52.9)
10:00 CET · Euro Area · S&P Global Eurozone Services PMI (consensus 52.5, previous 53)
10:00 CET · Euro Area · S&P Global Eurozone Composite PMI (consensus 52.7, previous 53.1)
10:30 CET · United Kingdom · S&P Global UK Manufacturing PMI (consensus 51.8, previous 51.9)
10:30 CET · United Kingdom · S&P Global UK Services PMI (consensus 51.8, previous 52.1)
10:30 CET · United Kingdom · S&P Global UK Composite PMI (consensus 51.7, previous 52)
12:30 CET · Russia · Key Rate (consensus 14.0%, previous 14.0%)
14:30 CET · Canada · Retail Sales MoM (consensus 1.3%, previous -0.7%)
14:30 CET · Canada · Retail Sales Ex Auto MoM (consensus 1.1%, previous -0.7%)
15:45 CET · United States · S&P Global US Manufacturing PMI (consensus 55.5, previous 55.9)
15:45 CET · United States · S&P Global US Services PMI (consensus 58, previous 58.8)
15:45 CET · United States · S&P Global US Composite PMI (consensus 57.4, previous 58.4)
17:00 CET · United States · Kansas City Fed Services Activity (previous 0)
21:00 CET · United States · Cattle on Feed-Marketing YOY% (consensus -7.3%, previous -3.3%)
21:00 CET · United States · Cattle on Feed-Feedlots YOY% (consensus 0.3%, previous 0.7%)
21:00 CET · United States · Cattle on Feed-Placements YOY% (consensus -8.0%, previous -9.2%)
21:00 CET · United States · Poultry Slaughter LW YOY% (previous 3.7%)
21:00 CET · United States · Cold Storage - Pork Bellies (previous 23.7m)
21:00 CET · United States · Cold Storage- Beef (previous 407.1m)
21:00 CET · United States · Cold Storage-Poultry (previous 1145.1m)
21:00 CET · United States · Cold Storage-Total Pork (previous 436.3m)
Central bank speech previews
Patrick Montagner (ECB Banking Supervision, 09:55 CET)
Patrick Montagner, a member of the ECB's Supervisory Board, gives a keynote at the European Systemic Risk Board's annual stress-test workshop in Kraków at 09:55 CET. The ECB will publish the text. In Paris on 1 October, he said European banks are resilient but warned against taking recent results for granted, because earnings partly rest on higher interest rates. He named credit risk management and operational resilience as supervisory priorities.
Piero Cipollone (European Central Bank, 16:00 CET)
ECB Executive Board member Piero Cipollone discusses the digital euro and the future of money with Howard Davies at the International Festival of Economics in Turin from 16:00 to 17:00 CET. The ECB says no text will be made available. In a speech on 6 October, he said the digital euro is designed as a means of payment, not an investment product, and not to disintermediate banks. The ECB aims to be ready for a first issuance in 2029 if the legislation is concluded by the end of 2026, he said. In an interview published on 8 October, he said it would complement cash at no cost to individuals and could halve the cost of digital payments for small merchants. Neither text discussed interest rates.
29 Oct: implied 2.45%, +1 bp priced, 3% (hike) probability of a move
17 Dec: implied 2.63%, +19 bp priced, 74% (hike) probability of a move
4 Feb: implied 2.71%, +27 bp priced, 33% (hike) probability of a move
18 Mar: implied 2.86%, +42 bp priced, 59% (hike) probability of a move
1 basis point priced for 29 Oct, a 3% probability of a 25 basis point rise, and 19 basis points cumulatively by 17 Dec.
Today's Briefing: AI Trade Stumbles on Meta and Tesla as Oil Rises on Saudi Attacks — https://ggma-app.com/public-article/ai-trade-stumbles-on-meta-and-tesla-as-oil-rises-on-saudi-attacks-212
Next GGMA Live Session: FOMC decision, Wednesday 28 October, 19:00 CET, in the app's Discussion Forum Light. Register at https://ggma-app.com/sign-up and reply in the chat to be added as a guest.
Tags: Japan CPI September 2026, Bank of Japan October meeting, UK retail sales September 2026, ECB Consumer Expectations Survey, University of Michigan consumer sentiment October 2026, Bank of Russia key rate decision, Piero Cipollone digital euro, flash PMI October 2026