Central bank meetings this week: The expected impact on Financial Markets

This week’s agenda is packed with a lot of economic indicators, meetings, and important decisions that will have wide-reaching effects on many markets and financial instruments, from the United States to Japan and China.

Several central banks will also be holding key interest rate meetings, headed by the US Federal Reserve, the Bank of Canada, the European Central Bank, and the Bank of Japan. These meetings are expected to have a major influence on market trends.

On another front, global markets will closely watch the US-China meeting in South Korea this week on Thursday, with the aim of clarifying the prospects of a trade agreement between the world’s two largest economies.

Key points:

• The US and China meet later this week.
• The US halts trade talks with Canada, while the Canadian prime minister signals his country’s willingness to continue discussions despite this.

• The US government shutdown continues, concerning developments and signals.

  

Central bank meetings this week: Impact on Financial markets

The US economy: The US credit crisis

Last week ended with the release of September’s inflation index, one of the most important economic indicators, despite the ongoing US government shutdown for over 25 consecutive days. The report boosted hopes for a more ambitious interest rate cut in upcoming Fed meetings.

The first of the "Magnificent Seven" companies began releasing third-quarter earnings. Tesla’s revenues exceeded expectations, though it fell short of projected profitability due to challenges in the electric vehicle sector and rising operational costs. Intel also released stronger-than-expected data, fueling optimism around AI-related stocks.

US tariffs reach a critical point

On the trade front, the US appears to be nearing a decisive moment with China, India, and Canada.

In Malaysia, a meeting was held between US Treasury Secretary Scott Peirce, US Trade Representative James Greer, and China’s top economic official, setting a positive tone ahead of the high-profile meeting between US President Donald Trump and his Chinese counterpart in South Korea on Thursday.

As for India, the US is close to finalizing a trade agreement that could reduce tariffs on New Delhi from 50% to 15–16%.

Regarding Canada, whose trade talks were threatened by Trump over a critical statement on US tariffs, Prime Minister Mark Carney stated that Canada is ready to resume trade discussions.

Potential trade agreements with Brazil are also progressing, with Trump confirming the possibility of removing all punitive tariffs imposed on the South American nation.

Major corporate earnings continue

Markets will witness significant corporate announcements, including:

• Visa: October 28, 2025
• Microsoft, Google, Meta, Caterpillar, Boeing: October 29, 2025
• Apple, Amazon, Lilly, Mastercard: October 30, 2025

US Federal Reserve penultimate meeting of 2025

The Fed will hold its seventh and penultimate meeting of the year to decide on interest rates. Expectations are high for a 25-basis-point cut following recent inflation data that rose less than expected year-over-year and declined month-over-month. Weak labor market data further support the continuation of rate cuts in the current and next December meetings.

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2. European economy amid central bank meetings this week

Private sector activity in the Eurozone accelerated in October, marking the tenth consecutive month of expansion and the fastest pace since mid-2024, a positive signal that the Eurozone economy may head toward recovery in Q4.

In France, economic activity declined faster than expected, reflecting weaker demand for goods and services.

The European Central Bank is preparing to decide on interest rates, with expectations that rates will remain unchanged. This decision coincides with critical economic data, including:

GDP: expected drop from 1.5% to 1.2% (October 30, 2025)

Consumer Price Index (CPI): slightly above the 2% target (October 31, 2025)

3. Japanese economy and BoJ outlook ahead of central bank meetings this week

New Prime Minister Sanai Takiyashi delivered her first parliamentary speech, emphasizing continued effective fiscal spending to support the fragile economy and prioritizing measures to address rising living costs. This includes policies such as abolishing the temporary gasoline tax in place since 1974 and raising the income tax-exempt threshold from $6,700 to around $10,000 annually.

Steady growth in the services sector is offsetting weakness in manufacturing. Inflation and a weak yen challenge Japanese companies, particularly as US tariffs impact exports. The Bank of Japan will hold its interest rate meeting on October 30, with no expected rate hikes.

4. Chinese economy in focus during global central bank meetings this week

China will hold the fourth plenary session of the Central Committee of the Communist Party next week, reviewing priorities under the 15th Five-Year Plan (2026–2030), focusing on advanced technology and boosting domestic consumption to enhance independence, security, and sustainable economic growth.

Despite GDP growth slowing to 4.8% (below the 5% target), China is still expected to reach $19.65 trillion in GDP for 2025.

China will also participate in a critical meeting with the US in South Korea to discuss key issues, especially those prioritized by the US, including rare metals, technology, and key crops like soybeans.

Economic calendar following Central bank meetings this week

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