US Inflation Data Eyed Ahead of Fed on Wednesday

US futures are pointing slightly higher on Monday, paring some of the late losses sustained on Friday after the FBI reopened its investigation into Hillary Clintons emails.

Coming just over a week before the election, the new probe into Clinton’s emails could do real damage to the significant lead she’d built up over the last month or so and has gifted Donald Trump the opportunity to put himself back in the race. The email investigation itself may once again yield no charges against Clinton but in planting a seed of doubt in voters’ minds so close to election day, the FBI may well have played a huge role in the outcome.

‘Pound’ for Your Thoughts?

Markets aren’t exactly getting too carried away with the new emails at this stage, possibly due to the size of the lead that many polls showed Clinton having prior to the announcement on Friday. That said, those assets most vulnerable to the election outcome may well experience a lot of volatility now as the election nears and the downside risks for these – such as the US dollar, Treasuries, US equities and the Mexican Peso – have increased.

There are a number of other key risk events in focus this week, including the Bank of Japan and Reserve Bank of Australia decisions overnight and the Bank of England decision on Thursday, but the majority are US related. Aside from the election next week, we also have the Federal Reserve decision on Wednesday, US jobs report on Friday and earnings season throughout the week. Today may be one of the quieter sessions and yet there is still some important economic data due out while more than a dozen US companies will report on the third quarter.

Oil and OPEC’s NIMBY’S

The economic data including the Fed’s preferred inflation measures, the core personal consumption expenditure price index, as well as personal income and spending figures for September. The core inflation number is expected to have risen by only 0.1% on the month which will leave it just below the Fed’s 2% target on the year, a target that hasn’t been hit in four and a half years.

For a look at all of today’s economic events, check out our economic calendar.

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