Economics week ahead

Wells Fargo Research Team Wells Fargo

Next week, focus turns first to Election Day, although we do not expect the outcome of the midterms to meaningfully change the U.S. economic outlook. We expect the ISM manufacturing and services indices to ease, but remain in expansion, with market focus on the prices paid components. The week closes with October payrolls on Friday, which we expect to rise by 65K alongside an unemployment rate that remains at 4.2%, consistent with a stable labor market.

Abroad, Canadian employment should rebound modestly in October after two consecutive declines, though hiring will remain subdued. Even so, the increased inflation risk and hawkish-pivot by the Bank of Canada has led us to mark up our expectations for the policy rate in coming months. That shift toward tighter policy extends elsewhere. Alongside expected rate hikes for the RBA and BoE next week, we have marked up our forecasts to include another hike from each in 2027. We expect more patience in emerging markets, with Brazil’s central bank and Banxico both on hold next week.

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Wells Fargo Research Team

Wells Fargo

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