It's a bumper week for central bank decisions, with the Fed (Wednesday), BoE (Thursday) and BoJ (Friday) all meeting. Central banks aside, key data releases include US retail sales (Wednesday) and industrial production (Friday), UK inflation (Wednesday) and labor market data (Tuesday), economic activity in China (tomorrow), and inflation and trade in Japan (Friday and Wednesday respectively). Other events include the annual testimony of the US Treasury Secretary namely Bessent (tomorrow), and the State of the Union address in Europe (Wednesday).
Delving into more detail now, DB's Jim Reid writes that the main event for markets will be the Fed’s decision on Wednesday. Deutsche economists have long expected a 25bp rate hike with the market now at 87% this morning up from around 35% two Friday's ago just before Warsh's Jackson Hole speech. Such a move would take the target range to 3.75%-4.00%. DB economists believe the accompanying projections are likely to show a somewhat stronger growth outlook alongside still-elevated inflation. They have also added an extra hike in March to their forecast which now makes it 75bps of hikes over the next 7 months. A big focus will be Warsh's press conference and how he squares the circle between a dislike of forward guidance and calming markets which are baying for more info.
Friday’s inflation data strengthened the case for action this week. Core CPI rose by 0.29% in August, a touch above expectations and up from 0.22% in July. The details were also firm, with notable strength in wireless services, airfares and lodging-away-from-home prices. Meanwhile, last Thursday’s PPI report contained hawkish elements, including stronger hospital and international airfare prices. Combining the latest CPI and PPI data, DB economists estimate August core PCE increased by 0.27%, a pace they do not view as consistent with sufficient progress back towards the Fed’s inflation target.
Attention will now turn to incoming US activity data. Tomorrow, markets will receive Treasury Secretary Bessent’s annual testimony before the House Financial Services Committee. On Wednesday, August US retail sales are released and economists expect a rebound to +0.8% month-on-month, following July’s -0.6% decline. They also forecast ex-auto sales at +0.5% and retail control sales at +0.4%, arguing that July’s weakness looked more like a temporary pause in consumer spending than the start of a broader slowdown. On Friday, industrial production is due and economists expect growth to edge up to +0.3% from +0.2% previously.
Looking beyond the US, the BoE announces its latest policy decision on Thursday. DB economists expect Bank Rate to remain unchanged at 3.75%, with a 6-3 voting split, and continue to see the MPC remaining relatively cautious compared with some other major central banks. However, the bond market and energy moves at the end of the week make it a closer call than it was, with futures pricing in a 23% probability of a move, up from under 10% early last Thursday. Before that, UK labor market data are released tomorrow, while August CPI is due on Wednesday. Economists expect headline inflation to rise to 3.04% YoY, while core CPI eases slightly to 2.53% YoY. UK retail sales, together with the GfK consumer confidence survey, follow on Friday.
In Asia, the BoJ concludes its meeting on Friday. DB's economists expect a 25bp rate hike (futures price in a 98% probability now), and argue that external considerations, including pressure for greater FX stability, are likely to be at least as important as domestic economic fundamentals in driving the decision. Japan also releases trade data and core machine orders on Wednesday, followed by national CPI on Friday, where DB economists expect core inflation excluding fresh food to remain at 1.8% YoY.
China’s August activity indicators are released tomorrow. DB economists expect industrial production growth to accelerate to 5.0% YoY from 4.5%, while retail sales and fixed-asset investment should also improve. Elsewhere, Germany’s ZEW survey is due tomorrow, while the ECB publishes its consumer expectations survey on Friday.
On the political front, the European Commission President delivers the annual State of the Union address on Wednesday, setting out priorities for the year ahead. Finally, the NATO’s Military Committee Conference takes place in Copenhagen at the end of the week.
Courtesy of DB, here is a day by day recap of the week's main events:
Monday September 14
Tuesday September 15
Wednesday September 16
Thursday September 17
Friday September 18
Finally, looking at just the US, the key economic data releases this week are the import prices report — because of its potential implications for core PCE — and the retail sales report on Wednesday. The September FOMC meeting is on Wednesday. The post-meeting statement will be released at 2:00 PM ET, followed by Chairman Warsh's press conference at 2:30 PM.
Monday, September 14
Tuesday, September 15
Wednesday, September 16
Thursday, September 17
Friday, September 18
Source: DB, Goldman, BOfA
Tyler Durden Mon, 09/14/2026 - 10:15Submitted by QTR's Fringe Finance
While the stock market implodes on or ahead of schedule, as predicted, I had another revelation last night that anyone with a first-grade understanding of math could have also arrived yet. We can’t afford this $5,000 dividend check idea.
I mean, we can’t really afford anything as a country right now, but it is arguably the worst moment in history to randomly hand out $5,000 to citizens for no reason.
I would love $5,000. You would love $5,000. I have yet to encounter the American who opens his mailbox, finds a check for five grand from the United States Treasury and screams, “Goddammit, not this again.”
But unfortunately, there is a very small problem with President Trump’s latest proposal to send every adult American a $5,000 “Trump dividend” if Republicans retain control of Congress in November: we don’t have the f*cking money.
Trump unveiled the idea at the Republican convention in Dallas, promising a $5,000 payment to every adult U.S. citizen if Republicans win the House and Senate. With roughly 240 million adult citizens, Reuters estimates the program would cost approximately $1.2 trillion. Trump’s explanation for how we can afford this is essentially that America is now swimming in money. “We’re taking in trillions, trillions of dollars,” he said while discussing the proposal.
And while tariff revenue has increased substantially, it isn’t remotely close to producing the trillions of dollars necessary to fund something like this. The federal government is already spending considerably more than it collects.
According to the Congressional Budget Office, the federal deficit reached roughly $1.8 trillion during the first ten months of fiscal 2026, about $169 billion more than during the same period last year. CBO estimates the full-year deficit will be roughly $2.1 trillion.
Think about what that means. We aren’t discussing what to do with a surplus. There isn’t some giant extra pile of money sitting in Washington. We’re already borrowing roughly $2 trillion a year to cover what the government spends, and now we’re contemplating borrowing another $1.2 trillion so Washington can mail everybody a check.
We’re calling it a “dividend” but that’s not generally how dividends work. If a company loses $2 trillion a year, borrows another $1.2 trillion and then distributes the borrowed money to shareholders, CNBC does not call it an exciting new capital return program. Eventually somebody from the SEC starts asking questions.
Meanwhile, the gross national debt has now blown through $40 trillion. Debt held by the public is roughly $32 trillion and, according to the Congressional Budget Office’s latest budget outlook, will equal about 101% of GDP this year. CBO projects that it will surpass the post World War II record of 106% of GDP around the end of this decade and reach approximately 120% by 2036.
This seems like a peculiar moment to find a new direction to spray cash we don’t have. And as if the existing fiscal situation weren’t sufficiently hilarious, America has simultaneously found itself with another extremely expensive item on its shopping list: weapons. Lots and lots of weapons.
The Pentagon has proposed a $1.5 trillion defense budget for fiscal 2027, versus roughly $900 billion approved for 2026, the largest year-over-year increase in defense spending in the postwar era and a budget I think could massively benefit one sector of the stock market. The administration says the increase includes major spending on missiles, drones, ships, aircraft, missile defense and rebuilding the defense industrial base. Iran-related costs would require additional funding.
And as we’re finding out now, the war with Iran has burned through significant quantities of expensive American munitions, and defense contractors are already anticipating years of replenishment orders. Reuters reported in July that conflicts including Iran and Ukraine have depleted Pentagon inventories that will have to be rebuilt.
So let me get this straight: our current financial plan appears to be to run a roughly $2 trillion deficit, fight an expensive war, replace a gigantic pile of missiles, dramatically increase defense spending and then mail everybody $5,000.
I am beginning to understand why the bond market has questions.
There is also the Strategic Petroleum Reserve, which has been drawn down enormously from its historical peak and remains far below the levels of only a few years ago. That’s particularly relevant when America is simultaneously dealing with a Middle Eastern war that has helped send oil back above $100 per barrel.
Emergency reserves exist to provide flexibility when bad things happen, but using them means eventually replenishing them. That costs money too.
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The Treasury market isn’t exactly celebrating the fiscal situation either. The benchmark 10-year Treasury yield has recently approached 5% and higher yields are especially nasty when you’re carrying tens of trillions of dollars in debt because old securities eventually mature and have to be refinanced at higher rates.
And interest expense is already becoming one of the biggest problems in the federal budget. The CBO projects that persistent primary deficits and rising interest costs will push the annual federal deficit from roughly $2 trillion today toward $3.1 trillion by 2036. So the ultimate cost of another $1.2 trillion giveaway isn’t necessarily $1.2 trillion. If we borrow the money, it’s $1.2 trillion plus the interest required to carry that debt indefinitely.
Trump has explicitly tied the $5,000 payments to Republicans retaining control of Congress in the November midterms. Whatever one thinks of the policy itself, attaching a four-figure government payment directly to an election outcome inevitably makes the proposal look at least partly like campaign politics, though it isn’t much different than Zohran Mamdani promising free everything for New York City to get elected.
The depressing answer to all of this is the one nobody wants to hear. America probably needs fewer promises of free money, not more of them. There is nothing particularly exciting about cutting spending, narrowing deficits, paying down debt and restoring some semblance of discipline to the federal balance sheet. Nobody wins a standing ovation by walking onto a stage and announcing, “Good news everybody, you’re getting nothing, but let me explain why that makes sense given the last half century of gross overconsumption and money printing.”
Eventually somebody has to pay the bill. We have more than $40 trillion in gross federal debt, annual deficits running around $2 trillion, debt held by the public roughly equal to the entire annual output of the American economy, rapidly rising interest costs, enormous new defense requirements and a bond market increasingly demanding more compensation to finance all of it.
The CBO’s long-term projections make the basic problem difficult to avoid: under current policy, debt keeps rising faster than the economy and deficits continue widening. Eventually stabilizing that trajectory requires some combination of lower spending and higher revenues, and waiting makes the necessary adjustment larger.
I certainly prefer the version of reality where somebody gives me $5,000, trust me. A $5,000 check would feel fantastic when it arrived. But dividends generally come from profits, and Uncle Sam isn’t turning a profit. He’s trying to put his bar tab on a fifth credit card that has been declined and has turned to looking for change under the barstools to pony up for one last beer. And the bartender is starting to look nervous.
Now read:
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Tyler Durden Mon, 09/14/2026 - 09:45
Summary:
US Energy Secretary Chris Wright joined Bloomberg TV to calm energy markets after last week's drone attack hit a pumping station on Saudi Arabia's East-West pipeline, prompting its immediate shutdown. The pipeline bypasses the Strait of Hormuz and transports crude to Saudi Arabia's Red Sea export terminal.
Wright said the pipeline could resume operations "very soon" and that he had been in close contact with his Saudi counterpart.
U.S. Energy Secretary Chris Wright says Saudi Arabia’s East-West pipeline will be back up and running “very soon.” pic.twitter.com/vengmvxLG7
— Clash Report (@clashreport) September 14, 2026"I might have more of a timeframe tomorrow," Wright said, adding that further clarity would emerge in the days ahead.
Wright also said more than 12 million barrels of oil passed through the Strait of Hormuz last night, putting the seven-day average above 10 million barrels a day.
AP News reported that flows through the pipeline could resume in three to five weeks.
Oil Surges As Saudi Pipeline Crisis Puts 4% Of Global Supply At Risk; Bernstein Warns Of $150 CrudeBrent crude futures jumped overnight after Saudi Arabia shut its East-West pipeline following drone attacks last week, threatening a critical route for bypassing the highly contested Strait of Hormuz chokepoint and a loss of what could amount to 4% of global supply.
The global oil benchmark rose as much as 3.7% to above $108 a barrel before trimming gains to $107.70 by 6:00 a.m. ET, while WTI futures traded around $103.
Riyadh described the shutdown as precautionary but gave no timetable for restarting the pipeline, which can transport upwards of 7 million barrels a day.
New geospatial intelligence shows what appears to be high-resolution satellite imagery of the aftermath of the drone attack that destroyed pumping infrastructure. Vantor produced this satellite imagery and shared it on X via The Hormuz Letter.
BREAKING: New high-resolution satellite imagery shows the pumping station on Saudi Arabia's East-West oil pipeline burned out end to end, with the entire process area blackened and crude oil that escaped the site pooled across the desert beyond the perimeter, per Vantor imagery. https://t.co/DFJAplGNcC pic.twitter.com/uQEdn2YVFe
— The Hormuz Letter (@HormuzLetter) September 14, 2026UBS energy expert Dominic Ellis summarized the weekend and overnight events unfolding across the Gulf region:
Brent has risen over $107/b on reports planned talks between Iran and GCC leaders on establishing a safe route through the Strait of Hormuz have been postponed indefinitely, and following reports Saudi Arabia closed its East-West pipeline following attacks late last week.
The pipeline, with capacity of 7mb/d, had played an important role in re-routing oil away from the Strait of Hormuz, and the impact of the pipeline's closure on Red Sea exports (combined with recent Houthi efforts to disrupt Red Sea flows) will continue to support oil prices for the foreseeable future.
Near-term impact on energy equities is positive – the UBS team flagged 40% upside to consensus 3Q earnings earlier this month (with refining-leveraged names like Repsol, Galp and OMV having 80-90% upside), and while buy-side numbers have likely responded to rapidly-changing macro conditions more frequently than those on the sell-side, I still believe market-wide caution on the sector means there is upside to expectations.
Saudi oil traders told Reuters on Sunday that if the East-West pipeline is not restarted promptly, then Saudi Arabia will run out of oil stocks for Red Sea exports.
More color per the outlet:
Sources that spoke to Reuters gave varying estimates, with one saying the damage could take as long as five to six weeks to repair, while another said it could be fixed sooner and could resume pumping partially while repairs are ongoing.
Saudi Arabia's government media office and energy ministry did not immediately respond to requests for comment.For the past six months, the pipeline running through the desert across the Arabian Peninsula has spared Saudi Arabia from the brunt of the impact of the wartime shutdown of the Strait of Hormuz that has crippled exports from its neighbours.
The world's biggest exporter has used the pipeline to reroute around 4 million barrels per day — around 4% of global supply — to the port of Yanbu on the Red Sea.But with the pipeline out of service, Yanbu now has stocks to maintain exports for just five to seven days, according to three industry sources familiar with Saudi exports.Saudi Arabia also has stocks to supply customers for several days from Egypt's ports of Ain Sukhna on the Red Sea and Sidi Kerir on the Mediterranean, a fourth source said.
Yanbu storage capacity stands at around 35 million barrels, according to industry estimates, with Ain Sukhna and Sidi Kerir able to store 18 million and 20 million barrels respectively.Stocks are not full and will ultimately run out without the east-west pipeline resuming operations, the four sources said.Saudi oil supply has already fallen to a more than three-decade low in August on reduced flows via Hormuz and the Red Sea, the International Energy Agency said on Friday.World oil supply will decline this year by 5.7 million bpd, or about 6%, the IEA, which coordinates Western energy policies, said.In addition to the attack on the pipeline, Houthi fighters in Yemen who have threatened Saudi oil shipments seized an island on Friday in the mouth of the Red Sea
Gulf developments over the weekend prompted Bernstein analysts Neil Beveridge and Brian Ho to warn that Brent could rally to between $120 and $150 a barrel as East-West pipeline disruptions collide with ongoing troubles along the Strait of Hormuz and the Bab el-Mandeb Strait in the southern Red Sea.
Beveridge described the market as "chronically undersupplied" and said their existing $90 Brent forecast for 2026 had been "overtaken by events."
Combined flows through Hormuz, Bab el-Mandeb and the Suez Canal remain below 7 million barrels a day, compared with roughly 20 million before the conflict, according to Bloomberg.
One of the biggest restraints on crude prices this summer has been the 5 million-barrel-a-day reduction in Chinese imports. But analysts said that decline partly reflects Beijing tapping its estimated 1.5 billion barrels of SPR. Imports are now recovering and bidding up oil prices around the world.
Tyler Durden Mon, 09/14/2026 - 09:36