Central banks hold, US growth remains resilient

US equities fell over the week as results from major tech companies, including Alphabet and Amazon, revived concerns over the returns on surging capital expenditure. US data remained resilient this week. The Federal Reserve held rates at 3.75–4.00%, maintaining a cautious stance, while Q3 GDP grew 3.4% annualised, up from 2.2% in Q2. Core PCE inflation remained elevated at 3.1% YoY, while consumer confidence rose to 91.7, beating expectations. 

Elsewhere, the ECB held rates unchanged at 2.50%, highlighting elevated inflation and growth uncertainty. The UK’s Autumn Forecast Statement upgraded 2026 growth to 1.2%, while the Bank of Japan held rates at 1.25% but signalled that further hikes remain likely.

Last week's highlights

	FED Rate Decision(28/10) - Held rates at 3.75–4.00%, maintaining a cautious stance. Q3 GDP (29/10) - Economy grew 3.4% annualised, up from 2.2% in Q2. Core PCE (29/10) - Held at 3.1% YoY, remaining above the Fed’s target. CB Consumer Confidence (27/10) - Rose to 91.7 from 84.2, beating expectations.
	ECB Interest Rate Decision (29/10) - Held rates unchanged, with the deposit rate at 2.50%, amid elevated inflation and growth uncertainty. ECB Press Conference (29/10) - Christine Lagarde stressed rising energy-price risks and elevated uncertainty, with policy to remain data-dependent.
	Autumn Forecast Statement (28/10) - Office for Budget Responsibility upgraded 2026 growth to 1.2%, with measures focused on easing energy costs and supporting growth.
	Japan BOJ Interest Rate Decision (30/10) - Held rates at 1.25%, but signalled further hikes remain likely.

Looking ahead, attention turns to the US jobs report, ISM surveys and JOLTS, alongside inflation data in the Eurozone and UK. Central bank decisions from the Bank of England, RBA, Brazil and Mexico will also be in focus, while China’s PMIs will provide an update on growth momentum. 

What's on the radar

	Nonfarm Payrolls and Unemployment Rate (06/11) ISM Manufacturing PMI (02/11) Non-Manufacturing PMI (04/11) JOLTS Job Openings (03/11) ADP Nonfarm Employment Change (04/11)
	CPI and Core CPI (YoY) (04/11) HCOB Eurozone Services and Composite PMI (04/11) HCOB Eurozone Manufacturing PMI (02/11)
	CPI (YoY) (04/11) BoE Interest Rate Decision (05/11)
	Australia RBA Interest Rate Decision (03/11) Brazil Interest Rate Decision (04/11) RatingDog China Manufacturing PMI (02/11) Services PMI (04/11) Mexico Interest Rate Decision (05/11)

Chart of the moment – Building the Boom 

• Data centres are a clear outlier in US construction, with real spending up 64% year-on-year, while power construction is also positive, up 4%. 
• Almost every other major construction category is contracting, including residential, commercial, healthcare and manufacturing. 
• This shows the scale of AI-related infrastructure investment, with capital being directed towards data centresand the power capacity needed to support them. 
• This raises the question once again if massive AI infrastructure spending will generate sufficient returns to justify the investment.