Beware! A String of US Sentiments Could Shake Markets Next Week
Global financial markets will face an important agenda next week, 24-30 August 2026. Investor attention will be concentrated on inflation data, economic growth, income and spending in the United States. Towards the end of the week, focus will shift to the Jackson Hole central bank symposium, Japanese consumer confidence, and the annual revision of US labour data. This series of events could determine the direction of the US dollar, US Treasury yields, the rupiah, gold prices and stock markets. According to Trading Economics, six selected data releases are categorised as high impact or three-star.
The US will announce July Core Personal Consumption Expenditures (core PCE) on Wednesday (26/8/2026) at 19.30 WIB. Consensus expects core PCE to grow 0.2% month-on-month, higher than the 0.1% growth in June. Meanwhile, Trading Economics projects an increase of 0.3%. The data will provide a picture of price pressures stemming from public consumption. The market will assess whether inflation remains high enough for the Federal Reserve to maintain tighter monetary policy for longer. Core PCE above expectations could lift the US dollar and US Treasury yields. This condition could potentially pressure the rupiah, gold prices, bonds and interest-rate-sensitive stocks. Conversely, lower-than-expected PCE could strengthen hopes that inflationary pressures are beginning to ease. That scenario could potentially increase investor interest in emerging market assets, including Indonesian stocks and bonds.
The US will also release the second estimate of second-quarter economic growth on Wednesday at 19.30 WIB. Gross domestic product is estimated to grow 1.5% on an annualised basis, lower than the previous estimate of 2.1%. The market will examine whether the revision stems from consumption, investment, inventories, trade or government spending. A broad-based decline could indicate US economic momentum is weakening faster than expected. Growth above consensus could reinforce the view that the US economy is still able to withstand high interest rate pressures. However, if the figure is accompanied by hot PCE inflation, the market may assess that the Fed has room to maintain tight policy. Conversely, a sharp downward revision could potentially pressure the dollar and bond yields. However, a figure that is too weak could also trigger concerns about the risk of an economic slowdown and pressure stock markets and commodity prices.
US personal income for July is scheduled to be announced on Wednesday at 19.30 WIB. Consensus expects income to grow 0.3% month-on-month, up from 0.2% in June. Trading Economics projects 0.2%. Strong income growth can maintain household purchasing power and support consumption. This is important because public spending is one of the main drivers of the US economy. However, income growth that is too rapid could also potentially sustain price pressures, especially if it comes from wage increases. This condition could make the process of lowering inflation slower. Conversely, lower-than-expected income could signal that purchasing power is beginning to weaken. The impact would be even more negative if followed by a decline in public spending and a slowdown in economic growth.
US personal spending for July will be announced simultaneously on Wednesday at 19.30 WIB. Consensus expects spending to grow 0.2% month-on-month, slowing from 0.3% in June. Trading Economics projects growth to remain at 0.3%. The market will compare spending growth with income. Spending growing faster than income could indicate consumers are using savings or increasing debt to maintain consumption. Strong spending can support economic growth and corporate earnings prospects. However, consumption that is too hot could also keep inflationary pressures and narrow the room for Fed policy easing. Meanwhile, weakening spending could indicate households are beginning to reduce consumption due to high prices, credit costs or concerns about the labour market. A combination of income and spending growing in balance would be the most positive scenario as it shows consumption remains strong without creating excessive inflationary pressure.
The Jackson Hole Economic Policy Symposium will take place on 27-29 August 2026. This year’s theme is “Financial Innovation: Implications for Payments and Policy.” The meeting brings together central bankers, economists, academics and financial market participants from various countries. The full schedule of keynote speeches had not been announced when this article was written. Investors will look for clues about central banks’ views on inflation, economic growth, financial stability and the direction of interest rates. Statements emphasising inflation risks could strengthen expectations that interest rates will remain high for longer. That scenario could potentially lift the US dollar and US Treasury yields while pressuring the rupiah, gold and emerging market stocks. Conversely, statements acknowledging economic or labour market weakness could increase expectations of looser monetary policy.
Japan will announce the August consumer confidence index on Friday (28/8/2026) at 12.00 WIB. Trading Economics projects the index to rise slightly to 35 from 34.9 in July. The data is the only Japanese agenda item categorised as high impact next week. A rise in the index could indicate Japanese households are starting to become more optimistic about income.