TS Pulse: The power of protest

The cost of living and disapproval of governments are leading to protests across Europe and India. The problem is they all want more spending, at a time few governments have the headroom in their already growing deficits. 

• Kevin Warsh signaled anticipated inflation had not swayed the Fed’s views on the US economy at the last meeting, causing traders to scale back expectations for a rate rise in October. Speaking at the IMF summit in Bangkok, Warsh stated they would not prejudge plans for the central bank's next policy vote and noted that economic conditions aligned with expectations from the September rate increase. The week started with a hike more likely than not, according to market pricing. But by the end of the week, the market was pricing in just a 15% chance after Warsh’s comments.
• US inflation rose slightly more than expected in September. The headline rate was expected to move up from 3.4% to 3.6%, but came in at 3.7%, while the core measure rose from 2.4% to 2.7%, again 0.1% higher than forecast. Both are the highest readings since May and the PPI measures significantly exceeding expectations won’t help the outlook. A 1.3% month-on-month rise, compared to 0.6% expected, pushed the annual rate to 6.3%, driven by higher energy costs.
• UK GDP surprised to the upside in the three months to August, growing 0.7% compared to forecasts for it to remain at 0.5%, and pushing the annual rate to a 46-month high of 2.1%. Growth in August was driven by a 0.8% increase in production output, led by manufacturing, which rose 1.2%, and mining and quarrying, up 1.4%. Services showed no growth and construction fell
• Brent Crude Oil climbed above $110 per barrel for the first time since mid-May, when the price hit the $114.40 peak during the Iran conflict. With maritime authorities reporting multiple attacks on commercial ships, Saudi Arabia and Iran-backed Houthi militants in Yemen also trading strikes, and Russia and Ukraine resuming attacks on each other's energy infrastructure, a new peak may not be far away.
• UK unemployment fell surprisingly in August – down to 4.7% from 4.9%, where it had been expected to stay. UK regular pay, excluding bonuses, rose when also expected to not change: up to 3.7% year-on-year in the three months to August, from 3.6% in the previous period. This was aided by private sector wage growth edging up to 3.0% from 2.9%, while public sector pay growth held steady at 6.3% for a second consecutive period.

Source: Bloomberg; pricing as per 20 October 2026

*TreasurySpring’s blogs and commentaries are provided for general information purposes only, and do not constitute legal, investment or other advice.