The week's most consequential data arrives Friday
ECB officials including Philip Lane and Isabel Schnabel discuss inflation dynamics and monetary policy as Eurozone inflation data for September is released. US employment report follows Fed rate cuts; weaker job creation could trigger additional rate cuts by late October, influencing global markets.
- Housing valuations in Portugal rose to 1,945 euros per square meter in July, up 18.7% year-over-year
- Eurozone unemployment at 6.2% in July, down 0.2 percentage points from a year earlier
- Mortgage rates in Portugal fell for the sixth consecutive month to 2.88% in July
- ECB inflation target is 2%, with August data showing inflation exactly at that level
- Federal Reserve's first employment report since rate cuts begins Friday
This week brings critical economic data for monetary policy: Eurozone inflation figures, US employment numbers, and central bank officials' speeches will guide interest rate decisions across major economies.
The week ahead will be shaped by two pieces of economic data that central banks across the Atlantic have been waiting for: how much prices are rising in Europe, and whether American employers are still hiring at a steady pace. These numbers, arriving over the next few days, will help determine whether the European Central Bank and the Federal Reserve continue cutting interest rates or hold course.
Monday opens with a parade of central bankers taking the microphone. From the ECB, Piero Cipollone will discuss innovation in payments systems, while Isabel Schnabel addresses the current state of monetary policy itself. Philip Lane, the bank's chief economist, speaks in Frankfurt about how inflation has moved throughout the year. David Ramsden from the Bank of England will also be in the city. Across the Atlantic, three Federal Reserve presidents—from New York, St. Louis, and Atlanta—will make public appearances. Their words will be parsed for any hint of what comes next.
In Portugal specifically, the focus turns to housing credit and deposit rates. In July, banks valued homes at an average of 1,945 euros per square meter when deciding how much to lend—up 34 euros from June and nearly 19 percent higher than July of the previous year. The August figures, due from the National Statistics Institute, are expected to show this climb continuing, a trend that has been nearly unbroken since 2023. Meanwhile, the Bank of Portugal will update mortgage rates and deposit rates for August on Tuesday. In July, the average interest rate on new home loans fell for the sixth consecutive month to 2.88 percent, while deposit rates dropped for the nineteenth straight month, sliding from 1.43 percent to 1.39 percent.
Portugal's inflation accelerated to 2.8 percent in August—the fifth month in a row of increases—so all eyes will be on September's numbers. Beyond the headline figure, economists will watch the underlying inflation rate, which strips out the most volatile items like fresh food and energy. This measure has been more stable, offering a clearer picture of price pressures in the broader economy.
By midweek, the major Eurozone economies—France, Italy, Germany, and Spain—will release their September inflation data first. The Eurostat figure for the entire bloc follows a day later. August showed inflation holding at 2 percent, exactly where the ECB wants it. The unemployment rate in the Eurozone stood at 6.2 percent in July, down 0.2 percentage points from a year earlier, but the question now is whether joblessness continued to ease in August. Though the ECB lacks the explicit employment mandate that the Federal Reserve carries, this figure still matters deeply for understanding whether European economies remain robust.
On Thursday, French unions have scheduled anti-austerity protests and strikes. The last round of demonstrations against budget cuts, on September 18, left at least three people injured and resulted in 140 arrests. The week's most consequential data arrives Friday: the American jobs report for September, the first employment snapshot since the Federal Reserve began lowering interest rates. Analysts expect job creation to continue slowing. If it does, markets may solidify their bets that the Fed will cut rates again by the end of October, a move that would ripple through global financial markets.
By Friday afternoon, Christine Lagarde, the ECB president, will take the stage for the second time in the week—this time at the farewell event for Klaas Knot, the Dutch central bank governor, speaking on "Europe in the World: Challenges and Opportunities." Investors will be listening intently for signals about the future direction of monetary policy in the Eurozone. The ECB's next policy meeting comes at the end of October, and by then, Lagarde will have seen not only the September inflation data but also the American employment picture. What she says Friday could hint at what the bank decides then.
Citas Notables
The ECB lacks the explicit employment mandate that the Federal Reserve carries, but this figure still matters deeply for understanding whether European economies remain robust— Economic analysis
La Conversación del Hearth Otra perspectiva de la historia
Why does a housing valuation number from Portugal matter to anyone outside the country?
Because it's a leading indicator of credit conditions. When banks are willing to lend more against property, it usually means they see economic stability ahead. A 19 percent year-over-year jump suggests confidence—or possibly overheating.
And the deposit rates falling for nineteen months straight—is that good or bad?
It's the consequence of the ECB keeping rates high to fight inflation. Savers get less return, which pushes people toward riskier investments. It's a squeeze that's been building for nearly two years.
Why do investors care so much about what Lagarde says on Friday if the ECB doesn't meet until late October?
Because she'll have all the September data in hand by then. Her words become a preview of what the bank is thinking. Markets move on expectations, not on decisions themselves.
The French protests—are those connected to the economic data?
Indirectly. The austerity measures being protested are partly a response to inflation and fiscal pressures. The economic data this week will either justify those measures or undermine the case for them.
If American job creation slows as expected, why would that lead to more rate cuts?
Because the Fed has a dual mandate: price stability and full employment. If jobs are weakening, the Fed can afford to cut rates without worrying as much about stoking inflation. It's a shift in what the data is telling them to do.
So this week is really about whether central banks can finally ease up?
Exactly. For two years they've been tightening to kill inflation. This week's data will tell them whether they can start reversing course without inflation coming roaring back.