Economics Week Ahead in Economics Fed and BoJ to hike

Week Ahead in Economics Fed and BoJ to hike From On Our Minds Key Themes: [New] Global economic outlook: Resilient, but a narrowing margin for error [link] Global Growth momentum has proved more resilient than expected and should hold through year-end Global Economic Outlook - before moderating in 2027. Meanwhile, sticky energy and food prices, tariffs, and firm demand are Resilient, but a narrowing slowing disinflation and tilting risks upwards. We now expect more central bank tightening margin for error almost across the board, although the Fed and ECB may remain insufficiently restrictive. Concentration risk compounds the challenge, narrowing the path between falling behind the Europe curve if AI capex prevails and overtightening if AI revenues disappoint. ECB meeting post- mortem: Onwards and US: August inflation data supports 25bps interest rate hike for September meeting Upwards Eyes have been on the August inflation report after slightly mixed comments by Fed officials, though Fed communication overall has recently turned more hawkish, amid concerns about slow progress BoE preview – yet another on inflation. Even Waller, although explicitly dovish, mentioned it may not take much acceleration hold, but how much in inflation to nudge him into supporting tighter policy. The anticipated PPI and CPI data came in further can this go on? relatively firm, likely resulting in a strong August PCE print. The underlying inflation remains persistently above the Fed’s 2% target, with trend PCE inflation still running around 2.5-3%, strongly France 2027 Election supporting an interest rate hike going into the FOMC meeting next week. Tracker n°2: What to expect from RN Europe: Higher energy prices on the driver’s seat; BoE to stay on hold Given rising energy, gas and electricity prices, combined with resilient economic activity, the ECB United States had little choice but to raise rates and signal further tightening. However, higher energy costs and September 2026 FOMC heatwave-related data volatility could renew growth concerns, making an October hike less Preview: And So, It Begins likely. We see December as the more probable timing for the next rate increase. In the UK, we August 2026 Employment expect the BoE to keep Bank Rate unchanged at 3.75% in a 6-3 vote split. Despite higher energy Situation: Bouncing Back prices, tighter financial conditions and limited signs of second-round effects give the MPC scope to wait for a bit longer. The key question is for how much longer (see our preview).

Asia Japan: BoJ to hike; the path ahead matters more India: The GDP deflator The BoJ is expected to raise rates next week by 25bp, as underlying inflation approaches 2% and debate – much ado about services pass-through remains firm. The key signals will be its inflation assessment, Ueda’s guidance something material and the perceived distance from neutral. We expect further quarterly hikes to take the policy rate to 2%, though yen moves, fiscal concerns and future board appointments may affect the pace. Latin America Brazil 2Q26 GDP: Headline EM: Taiwan to start hiking; Brazil to signal a pause on easing resilience unlikely to last The CBC to begin its hiking cycle at the upcoming meeting. Strong growth and sticky inflation in 2H26 support an immediate move, reinforced by our expectation that the Fed will start hiking this month. The BCB is likely to deliver a 25bp cut to 13.75% but signal a pause ahead, as structural inflation pressures, fiscal risks, election uncertainty and less supportive external conditions constrain the easing scope.

Key Data Releases and Events Coming Next Week: Monday: India CPI; Japan IP Tuesday: China retail sales, IP, FAI; France CPI; Germany ZEW; UK jobs Wednesday: Euro area IP; UK CPI; US retail sales, FOMC; BCB (Brazil) Thursday: CBC (Taiwan); CNB (Czech); BOE; Euro area CPI Friday: BOJ, Japan CPI; US industrial production. This document contains important disclaimer and disclosure information. Please refer to the back inside cover of this research report.

Calendar – G5 – 14 - 18 September G5 Monday 14 September Tuesday 15 September Wednesday 16 September Thursday 17 September Friday 18 September Euro area Unit…