September CPI and bank earnings arrive two weeks before the Fed decides

September's consumer-price report arrives Wednesday, October 14, two weeks before the Federal Reserve's rate decision on Wednesday, October 28, the second day of its October 27–28 meeting. Minutes of the meeting on Tuesday and Wednesday, September 15 and 16, released Wednesday, October 7, said most participants assessed that another rate increase would likely be appropriate by the end of the year, and that they would approach each meeting with an open mind.

The September price report is part of the incoming information the minutes said those decisions would depend on. The largest US banks start reporting on Tuesday, October 13.

The Bureau of Labor Statistics publishes the September consumer price index at 8:30 a.m. Eastern on Wednesday. Econoday's survey of economist forecasts looks for a 0.6% rise in headline prices from August, after 0.4%, and a 0.2% rise in core prices, which leave out food and energy, after 0.3%. Over the year, the same survey looks for 3.6% on the headline, after 3.4%, and 2.5% on the core measure, after 2.4%.

The monthly core rate is expected to slow. The yearly core rate is expected to pick up.

In August, energy prices rose 2.1% and gasoline rose 3.9%, the bureau reported on Friday, September 11. Energy was up 16.3% over the year, and gasoline 27.4%. Brent crude, the global oil benchmark, last traded at $104.72 on the evening of Friday, October 9. A faster monthly headline and a slower monthly core would put the month's extra pressure in fuel, not in the rest of the basket.

"The plain fact is that inflation is too high and has been for too long," Chairman Kevin Warsh said at his press conference on Wednesday, September 16.

That day the Federal Open Market Committee, the Fed's rate-setting group, raised the target range for the federal funds rate, its main policy rate, by a quarter of a percentage point, to 3.75% to 4%.

"We must be confident that underlying inflation is moving to our objective, clearly and at sufficient speed," Warsh said at the same press conference.

That is the standard he set for judging progress toward the 2% inflation goal the minutes name. It is not a date for the next move.

The decision is announced at 2:00 p.m. Eastern on Wednesday, October 28, with a press conference at 2:30 p.m. That meeting does not include a new set of economic projections. The meeting on Tuesday and Wednesday, December 8 and 9, does.

The Fed's Beige Book, its collection of business anecdotes from the regional districts, is due Wednesday at 2:00 p.m. Eastern, the same afternoon as the price index.

The Treasury's reading on Friday, October 9, put the 10-year yield at 5.24% and the 30-year at 5.6%. The share price of the iShares 20+ Year Treasury Bond ETF, BTLT, a fund of US Treasuries that mature in more than 20 years, was down 10.5% for the year as of that close, before dividends.

For a holder, Wednesday's report is the inflation evidence the Fed will have at the October 27–28 meeting, and this fund is where that evidence sits in a portfolio of long Treasuries.

The State Street SPDR S&P 500 ETF, ASPY, which tracks the S&P 500, closed Friday, October 9, at $778.57, 0.4% under its 52-week high. A holder is near that high heading into Wednesday's inflation report and the bank results that start Tuesday.

Stocks open Monday. Bond trading is recommended closed.

US stock exchanges are scheduled to open on Monday, October 12, Columbus Day. Shares of BTLT can still be bought and sold, because those exchanges are open.

The Securities Industry and Financial Markets Association, in a notice on Tuesday, September 29, confirmed its recommendation of a full close that day for trading in dollar-denominated government securities, mortgage-backed securities and municipal bonds. The recommendation does not bind any firm. Each firm decides whether its bond desk stays open.

For a holder of BTLT, Monday is not a normal session in the Treasury market that prices the bonds inside the fund. If firms follow the recommendation, that market is closed. That limits the usual reference for pricing what the fund holds. It does not stop the shares from trading.

The banks open the quarter

JPMorgan Chase has set its third-quarter results for approximately 7:00 a.m. Eastern on Tuesday, October 13, and its call for 8:30 a.m. Goldman Sachs, Wells Fargo and Citigroup are also due Tuesday. Bank of America and Morgan Stanley follow on Wednesday.

JPMorgan alone is 11.5% of the State Street Financial Select Sector SPDR ETF, AXLF, a fund of the financial companies in the S&P 500. With Bank of America, Goldman Sachs, Wells Fargo and Morgan Stanley, the five are about a quarter of the fund.

For a holder, those two mornings are when that slice of the fund reports. The comparison that matters is whether loan demand, deposit costs and credit are telling the same story, and whether trading and dealmaking are carrying the results. A strong result at one bank does not answer that for the fund.

As of Friday, October 2, FactSet expected earnings for S&P 500 companies in the third quarter to grow 29.5% from a year earlier. The bank reports are the first large set of results to set against that pace.

Wednesday also puts a large fund manager on the same morning as the inflation report. BlackRock has scheduled its results before the New York open, and its call for 7:30 a.m. Eastern, one hour before the consumer price index.

Chip sales are already known

Taiwan Semiconductor Manufacturing's third-quarter revenue is not the open question. Reuters reported on Thursday, October 8, that the figure reached a record 1.49 trillion Taiwan dollars, about $46.71 billion, 50% above a year earlier. The company has set its earnings conference for Thursday, October 15, at 2:00 a.m. Eastern, which is 2:00 p.m. in Taiwan, before the US stock market opens. TSMC lists that same hour as 14:00 Taiwan time and 2:00 Eastern time. Still open are the margin, the capacity plan and the outlook.

ASML, which makes the machines that print the most advanced chips, has scheduled its release for Wednesday, October 14, at 7:00 a.m. Central European time, also before US trading begins. Its orders are a check on whether chipmakers are still committing money to future factories. That is a different question from how many chips TSMC shipped last quarter.

The VanEck Semiconductor ETF, ASMH, a fund of chipmakers and their equipment suppliers, fell 4.3% in the week through Friday, October 9. TSMC is 9.3% of the fund and ASML is 4.4%, about 14% combined. Nvidia, which does not report this week, is still about a fifth of the fund. For a holder, the open questions are the outlook and ASML's orders, not sales that are already on the books.

The morning after the price report

Thursday, October 15, at 8:30 a.m. Eastern, retail sales and producer prices arrive together.

Advance retail sales for September are the consumer check. The Census Bureau has set the report for that hour. Its latest revised reading showed August sales up 1.1% from July. Econoday's survey looks for a 0.3% gain, and for 0.2% once vehicles and gasoline are excluded. With gasoline already doing so much of the inflation work, the figure that leaves gasoline out is the one that says whether households bought more of anything else.

Producer prices arrive in the same minute. The Bureau of Labor Statistics has scheduled the September producer price index for that hour. Econoday's survey looks for a 0.5% rise in final demand, after 0.4%, and for the yearly rate to hold at 5.4%, already well above the consumer inflation rates expected the day before.

The blackout starts Saturday

Governor Christopher Waller is scheduled on Tuesday, October 13, Vice Chair for Supervision Michelle Bowman on Wednesday, October 14, and Chairman Warsh on Thursday night, October 15, with Kristalina Georgieva, managing director of the International Monetary Fund.

The communications blackout, the period when Fed officials generally do not speak publicly, begins at 12:00 a.m. Eastern at the start of Saturday, October 17, and runs through Thursday, October 29.

The week asks three separate questions. Wednesday asks whether the monthly core rate is slowing even as the yearly core rate rises, and whether fuel is what keeps the headline faster. The bank calls ask whether borrowers, deposit costs and dealmaking agree with one another. ASML's orders and TSMC's outlook ask whether the next round of chip spending is still being placed, after sales that are already on the books.