We get the Fed next week. And for a "data dependent" Fed, they will be working with little published government data, aside from tomorrow's report on September CPI. The consensus view is for little change from August.
The market is pricing in a quarter point cut for next week, and another quarter point for December.
More important than CPI, are the meetings with China that will start this weekend, to prep for a meeting between Trump and Xi next Thursday.
Remember, the word decoupling was used by Scott Bessent earlier this month, in response to China’s move to restrict rare earth exports. That’s quite a threat, coming from the mouth of the U.S. Treasury Secretary.
Jameson Greer called it a “global supply chain power grab,” and a form of “economic coercion on every country in the world.”
Bessent framed it as "China versus the world."
Trump has since done a deal with Australia on rare earths, to build some negotiating leverage against China. And before the Xi meeting, Trump will be looking to demonstrate solidarity with Asian allies against the China threat.
As we've discussed here in my daily notes, "isolating China" may be the ultimate outcome, but it seems the Trump administration would be happy to kick the can down the road again, with another "pause" on tariff escalations — buying time to execute their domestic agenda under some relative global stability.