Tomorrow's Macro Roadmap: UK Inflation Is Expected to Climb to 3.4% From 3.1%
Wednesday, 21 October 2026 — UK consumer prices for September open the European day at 08:00 CET, and Bank of England Governor Andrew Bailey speaks in London at 15:00 CET, a fortnight before a decision at which swap traders assign an 94% probability to a rate rise.
Our three themes for tomorrow:
The first is UK inflation. The September print at 08:00 CET is expected to climb to 3.4% on the year from 3.1%, and the services measure at 3.6% is the line that decides whether the Bank of England's 5 November meeting delivers the rate rise swap traders price at 94%. Forecasts for the headline run from 3.3% to 3.6%, with 3.4% the median; a print at the median would change little for the Bank of England, so the services and core figures carry more weight for the November decision than the headline.
The second is Bailey. The Governor speaks in London at 15:00 CET, seven hours after the data; a repeat of his Bangkok line that the energy shock has not yet spread widely would soften the November call, while endorsing the Bank's above-4% projection for early 2027 would confirm it.
The third is the central-bank diary beyond Britain. Hauser speaks in Sydney before Europe opens with a 30% probability of a November rise priced for Australia, Lane and Lagarde make the ECB's last appearances before its quiet period with a December rise the base case, and New Zealand's third-quarter inflation lands after the US close at an expected 3.8%.
Scenarios
United Kingdom: Consumer prices (Sep) (08:00 CET, High impact): Economists expect 3.4% on the year and 0.3% on the month, with core at 2.8% and services at 3.6%. A reading above the 3.9% top of the services survey range could lift gilt yields and push the probability of a 5 November rate rise above the 94% priced; a services print unchanged at August's 3.4% would revive the case for waiting.
Australia: Hauser fireside chat (23:45 CET on Tuesday, Medium impact): A deputy governor leaning on the September minutes' upside risks would add to the 30% probability priced for a rate rise on 3-4 November. If he focuses on the unemployment-rate upside surprise in the latest labour market report, it could weigh on the Australian dollar and lower bond yields.
Euro area: Lane panel (06:15 CET, Low impact): A panel on the international monetary system; a remark on underlying inflation would be read against the December rate rise most forecasters expect, with a 6% probability priced for 29 October.
United Kingdom: Bailey fireside chat (15:00 CET, Potentially high impact): A repeat of his Bangkok line that the shock has not yet spread widely would read as a committee still weighing a hold; endorsing the above-4% inflation projection would confirm the November rise and push the two-year gilt yield higher.
Euro area: Lagarde conversation (18:30 CET, Low impact): No text; a repeat of her line that the bond selloff slows inflation would be read as comfort with the December pricing rather than a push for October.
Speakers
Scheduled speakers: Andrew Hauser (Reserve Bank of Australia, 23:45 CET on Tuesday (08:45 Wednesday in Sydney)); Philip Lane (European Central Bank, 06:15 CET); Piero Cipollone (European Central Bank, 10:00 CET); Andrew Bailey (Bank of England, 15:00 CET); Christine Lagarde (European Central Bank, 18:30 CET).
The full preview
Data release previews
The Office for National Statistics publishes the UK consumer price index (CPI) for September at 08:00 CET.
Economists expect annual inflation of 3.4%, up from 3.1% in August, with prices rising 0.3% on the month after 0.5%.
Core inflation is forecast to rise to 2.8% on the year from 2.6%, and services inflation to 3.6% from 3.4%.
The rise is expected from road fuel and food, as last year's price falls drop out of the annual comparison, while airfares and cultural services lift the core measure.
One house expects the headline rate to reach about 4% early next year on current gas prices and sees a path to 5% if second-round effects appear; another puts the peak near 4% around the turn of the year.
The lowest forecasts sit at 3.3% for the headline rate and 2.5% for core, the highest at 3.6% and 3.0%. One house notes that regulated electricity and gas prices rise 4% in October, which keeps the headline rate climbing into the fourth quarter.
Bloomberg survey: median 3.4%, range 3.3% to 3.6% (as of 20-10-2026).
BoE market pricing as of 20-10-2026, 17:18 CET:
5 Nov: implied 3.97%, +23 bp priced, 94% (hike) probability of a move
17 Dec: implied 4.10%, +36 bp priced, 52% (hike) probability of a move
4 Feb: implied 4.31%, +58 bp priced, 85% (hike) probability of a move
18 Mar: implied 4.46%, +72 bp priced, 59% (hike) probability of a move
23 basis points priced for 5 Nov, a 94% probability of a 25 basis point rise, and 36 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: Inflation at 3.4% would be a nine-month high, and the Bank of England already projects a rate above 4% in early 2027, so the question for the 5 November meeting is what sits beneath the headline. Services inflation at the 3.6% economists expect, or above, would show the energy shock feeding into domestic prices and keep a rate rise as the base case. Services unchanged at August's 3.4%, with core below the 2.8% expected, would fit the reading Bailey gave in Bangkok, that the shock had not yet spread widely.
Also on the calendar
00:30 CET · Australia · RBA's Hauser-Appearance
01:50 CET · Japan · Trade Balance (consensus -¥210.4b, previous -¥1105.6b)
01:50 CET · Japan · Exports YoY (consensus 21.3%, previous 19.3%)
01:50 CET · Japan · Imports YoY (consensus 20.4%, previous 28.0%)
01:50 CET · Japan · Trade Balance Adjusted (consensus -¥250.1b, previous -¥840.6b)
08:00 CET · United Kingdom · CPIH YoY (consensus 3.5%, previous 3.3%)
08:00 CET · United Kingdom · Retail Price Index (consensus 422, previous 421.6)
08:00 CET · United Kingdom · RPI MoM (consensus 0.1%, previous 0.6%)
08:00 CET · United Kingdom · RPI YoY (consensus 3.9%, previous 3.4%)
08:00 CET · United Kingdom · RPI Ex Mort Int.Payments (YoY) (previous 3.3%)
08:00 CET · United Kingdom · Public Finances (PSNCR) (previous 10.0b)
08:00 CET · United Kingdom · Central Government NCR (previous 10.0b)
08:00 CET · United Kingdom · Public Sector Net Borrowing (consensus 24.0b, previous 18.3b)
08:00 CET · United Kingdom · PSNB ex Banking Groups (previous 18.3b)
08:00 CET · United Kingdom · PPI Output NSA MoM (consensus 0.6%, previous 0.7%)
08:00 CET · United Kingdom · PPI Output NSA YoY (consensus 4.4%, previous 3.7%)
08:00 CET · United Kingdom · PPI Input NSA MoM (consensus 1.4%, previous 0.3%)
08:00 CET · United Kingdom · PPI Input NSA YoY (consensus 7.6%, previous 6.1%)
09:00 CET · Switzerland · Money Supply M3 YoY (previous 3.5%)
10:30 CET · United Kingdom · House Price Index YoY (previous 1.4%)
11:00 CET · Euro Area · Govt Debt/GDP Ratio (previous 87.8%)
13:00 CET · United States · MBA Mortgage Applications (previous -2.7%)
16:30 CET · United States · DOE Total Fuel Ethanol Inventory (previous 23942k)
16:30 CET · United States · DOE Fuel Ethanol Total Production (previous 1065k)
16:30 CET · United States · DOE U.S. Crude Oil Inventories (consensus -340k, previous -8557k)
16:30 CET · United States · DOE Cushing OK Crude Inventory (previous 1862k)
16:30 CET · United States · DOE U.S. Gasoline Inventories (consensus -310k, previous 3518k)
16:30 CET · United States · DOE U.S. Distillate Inventory (consensus -1240k, previous -2527k)
16:30 CET · United States · DOE U.S. Refinery Utilization (consensus -0.32%, previous 0.8%)
16:30 CET · United States · DOE Crude Oil Implied Demand (previous 20950)
16:30 CET · United States · DOE Gasoline Implied Demand (previous 9199.1)
16:30 CET · United States · DOE Distillate Implied Demand (previous 5695)
23:45 CET · New Zealand · CPI QoQ (consensus 0.8%, previous 1.5%)
23:45 CET · New Zealand · CPI YoY (consensus 3.8%, previous 4.1%)
23:45 CET · New Zealand · CPI Tradeable QoQ (consensus 0.2%, previous 2.7%)
23:45 CET · New Zealand · CPI Non Tradeable QoQ (consensus 1.2%, previous 0.6%)
Central bank speech previews
Andrew Hauser (Reserve Bank of Australia, 23:45 CET on Tuesday (08:45 Wednesday in Sydney))
Deputy Governor Andrew Hauser holds a fireside chat at a bank-hosted investment conference in Sydney, streamed live. The Reserve Bank's board meets on 3-4 November, and swap traders assign a 30% probability to a rate rise there; the third-quarter consumer price index on 28 October is the bigger input. His last public remarks were an interview on the ABC's 7.30 programme on 8 September, where he framed the question as whether the three rises early this year were enough or more was needed, named three upside risks to inflation (the Middle East, an AI-driven global boom and the weak supply capacity of the Australian economy) and said the latest inflation and growth data had come in stronger than the Bank and the market expected. He refused to call a rise inevitable, with nine board members voting, but warned that if the slow path back to target stopped looking feasible the board would raise rates further than it otherwise would, and that he had returned from the United States more worried about the upside risks.
3 Nov: implied 4.67%, +8 bp priced, 30% (hike) probability of a move
8 Dec: implied 4.72%, +13 bp priced, 21% (hike) probability of a move
9 Feb: implied 4.79%, +19 bp priced, 25% (hike) probability of a move
23 Mar: implied 4.80%, +20 bp priced, 5% (hike) probability of a move
8 basis points priced for 3 Nov, a 30% probability of a 25 basis point rise, and 13 basis points cumulatively by 8 Dec.
Editor's Note: Forecasters are split between a hold and a rise in November, with the September minutes read as hawkish and the labour market loosening at 4.7% unemployment, so any comment on whether the board's inflation focus outweighs the softer jobs data would move the Australian dollar and three-year yields.
Philip Lane (European Central Bank, 06:15 CET)
Chief Economist Philip Lane joins a panel on 'Monetary System Beyond the Dollar' at a closed-door luncheon in Shanghai; the ECB will publish the text. In his last speech, dinner remarks on AI in Dublin on 13 October, he said the global AI investment boom is lifting long-term interest rates and that the spillover amounts to a material tightening of euro-area financial conditions, a factor in setting the policy stance. His last policy speech, on 5 October, set out the three criteria behind rate decisions: the inflation outlook and its risks, underlying inflation, and the strength of transmission, with the medium-term component of the outlook the central input. He said the energy shock drove September's 3.8% inflation, while non-energy inflation at 2.3% and services at 3.2% showed no upward shift in medium-term pressures, called the rise in oil and gas prices since July a second wave of the shock with upside risks to inflation and downside risks to growth, and described the two rises to 2.5% as a measured middle path with no pre-committed rate path. Swap traders assign a 6% probability to a rate rise on 29 October and 85% to one by December.
29 Oct: implied 2.46%, +2 bp priced, 6% (hike) probability of a move
17 Dec: implied 2.67%, +23 bp priced, 85% (hike) probability of a move
4 Feb: implied 2.76%, +32 bp priced, 34% (hike) probability of a move
18 Mar: implied 2.90%, +46 bp priced, 59% (hike) probability of a move
2 basis points priced for 29 Oct, a 6% probability of a 25 basis point rise, and 23 basis points cumulatively by 17 Dec.
Editor's Note: A panel on the international monetary system is unlikely to carry a policy signal, but Lane is the last Executive Board economist to speak before the quiet period; anything on how the energy shock is feeding underlying inflation would be read against the December rate rise most forecasters expect rather than October.
Piero Cipollone (European Central Bank, 10:00 CET)
Executive Board member Piero Cipollone gives an online presentation to the Italian Banking Association's executive committee; the ECB will publish the slides. His portfolio covers payments and the digital euro, and his recent appearances have stayed with that brief; he speaks again at a festival in Turin on Friday. His last speech, to an MNI webcast on 6 October, argued that without a digital form of cash the role of public money may keep declining: the digital-euro pilot is planned for the second half of 2027 and would run for 12 months, with a potential first issuance in 2029 if the legislation is concluded by the end of 2026.
Editor's Note: A payments presentation to bankers rarely moves the euro; the policy content is likely to be low.
Andrew Bailey (Bank of England, 15:00 CET)
Governor Andrew Bailey holds a fireside chat on central bank independence in an era of financial instability at the Official Monetary and Financial Institutions Forum in London, seven hours after the inflation data and a fortnight before the 5 November decision. In Bangkok last week, he said there was little evidence yet that the energy shock was spreading widely across the economy, while warning that the longer the Middle East conflict lasts, the harder it becomes to avoid a rate rise. His last published speech, in Istanbul on 8 October, was on financial resilience: a one-off supply shock can be looked through only while inflation expectations stay anchored, second-round effects emerge slowly, and the sequence of Covid and Ukraine makes that risk acute; rates may need to rise even as activity weakens, and he remains sceptical of unconditional promises about future interest rates.
Editor's Note: The title points at institutional questions, but the audience will listen for his reading of the morning's print: a repeat of his Bangkok line that the shock has not yet spread widely, after a 3.4% headline, would read as a committee still weighing a hold, while a shift to the Bank's own projection of inflation above 4% would confirm the rise that swap traders price at 94% for November.
Christine Lagarde (European Central Bank, 18:30 CET)
President Christine Lagarde takes part in an on-stage conversation at the Museum Reinhard Ernst in Wiesbaden; no text will be published. At the IMF meetings last week she said the bond selloff would slow inflation, and her statement to the IMF committee on 17 October spelt it out: the energy shock is too large to look through, but a measured response remains appropriate; there is no evidence yet of significant pass-through to other prices and wages beyond what the projections assume; the rise in long-term rates since the September meeting will slow growth and reduce pass-through by more than projected; and headline inflation should stay well above target into the first half of 2027 before returning to around target towards the end of that year.
Editor's Note: A museum conversation without a text is the least likely of the day's appearances to carry policy news; her Bangkok line that higher yields do part of the work is the frame markets would apply to any repeat.
Today's Briefing: Asian Tech Stocks Slide on AI Jitters as Canada Hike Bets Climb — https://ggma-app.com/public-article/asian-tech-stocks-slide-on-ai-jitters-as-canada-hike-bets-climb-208
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Tags: UK CPI September 2026, Bank of England November rate rise, Andrew Bailey OMFIF, Philip Lane Shanghai panel, Andrew Hauser RBA, New Zealand CPI Q3 2026