Central banks in wait-and-see mode

It was a volatile week in US equities as conflict continued in the Middle East and the Federal Reserve (Fed) continued with a hawkish tone. In Kevin Warsh’s second meeting as Fed Chair, interest rates were held steady, with Warsh reiterating that the Fed will not “waver” in its efforts to control inflation. On the data front, core PCE came in at 3.7%, in line with expectations.

Over in the Eurozone, inflation rose to 2.9% in July as renewed conflict in the Middle East drove energy costs higher. The Bank of England kept interest rates on hold as expected, but a growing number of policymakers voted for a hike amid continued uncertainty over the inflationary impact of the war. Elsewhere, the Bank of Japan left rates unchanged as expected but warned that core inflation was likely to exceed its 2% target from September. Finally, China’s manufacturing PMI decreased to 49.2 in July from 50.3 in June, below forecast of 50.0.

Last week's highlights

	FOMC Meeting (29/07) – Left rates unchanged as expected. Warsh insisted that the Fed will not “waver” in its efforts to control inflation. Core PCE Price Index (30/07) – Core PCE came in at 3.7%, in line with expectations.
	Eurozone CPI - July preliminary (31/07) - Eurozone inflation rose to 2.9% in July as the renewed conflict in the Middle East drove energy costs higher.
	Bank of England Meeting (30/07) - Kept interest rates on hold as expected, but a growing number of policymakers voted for a hike.
	Bank of Japan Meeting (31/07) – Held rates steady as expected but warned that core inflation was likely to exceed its 2% target from September. China Manufacturing PMI (31/07) – Decreased to 49.2 in July from 50.3 in June, below forecast of 50.0.

This week, investors will focus on a range of labour market indicators in the US after June’s nonfarm payrolls report came in below expectations. In Europe, the HCOB Eurozone Manufacturing PMI is due out, while UK investors will receive S&P Global’s Composite PMI. Emerging market investors will also be watching central bank meetings in Brazil and India.

What's on the radar

	JOLTS Job Openings (04/08) ADP Nonfarm Employment Change (05/08) Nonfarm Payrolls (07/08)
	HCOB Eurozone Manufacturing PMI (03/08)
	S&P Global Composite PMI (05/08)
	Reserve Bank of India Meeting (05/08) Brazilian Central Bank Meeting (05/08)

Chart of the moment - Magnificent Semis

Source: FactSet, JP Morgan Asset Management as of 21/07/2026. Notes: Hyperscalers are a market-weighted composite of Amazon, Alphabet, Meta and Microsoft. Semis = Semiconductors & Semiconductor Equipment Index. Hyperscaler 3Q25 and 1Q26 EPS numbers were adjusted to exclude non-cash impacts from tax and equity investments. 

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