Fed, ECB and UK Budget Converge in a Pivotal Week for the Global Economy
Key Takeaways
- •Capital Economics has flagged the upcoming week as a critical one for the global economy, with a Federal Reserve meeting, an decision, and the UK Budget all concentrated into the same period.
- •Chief Europe Economist Andrew Kenningham expects the ECB to deliver only one more interest-rate increase, pointing to a euro-zone economy that has remained fairly resilient despite the Iran war and elevated energy prices.
- •Deputy Chief Euro-zone Economist Jack Allen-Reynolds concluded that euro-zone bond markets are a long way from requiring ECB intervention, with the gap between 10-year sovereign yields offering a yardstick for policymakers' concern levels.
- •Chief Global Economist Jennifer McKeown argued that reports of the death of forward guidance are overstated, meaning central banks' accompanying statements merit as much attention as the rate decisions themselves.
- •Alongside the podcast, Capital Economics is hosting an event on the October Fed and ECB meetings and has published a UK Budget preview addressing outstanding fiscal questions.
Capital Economics has framed the coming week as a pivotal one for the global economy, with a Federal Reserve policy meeting, a European Central Bank decision and the UK Budget all landing in quick succession. The firm laid out the schedule and its economists' thinking in the latest episode of its Weekly Briefing podcast, published on 23 October 2026. The clustering matters because it condenses decisions on US and euro-zone interest rates, alongside the UK's tax and spending plans, into a single week's news flow.
The episode is available via Spotify and on Apple Podcasts, as well as on other leading podcast platforms. The full episode page appears on the Capital Economics website.
ECB will hike only once more
Chief Europe Economist Andrew Kenningham argues in ECB will hike only once more that the ECB will deliver only one further rate increase. The supporting evidence, according to the publication, points to a euro-zone economy that remains fairly resilient in the face of the Iran war, even with energy prices elevated.
When would the ECB intervene in bond markets?
Deputy Chief Euro-zone Economist Jack Allen-Reynolds examines when the ECB would intervene in bond markets. His conclusion is that bond markets are a long way from needing ECB intervention. In the recent past, he observes, policymakers have only got twitchy when 10-year sovereign spreads were... For readers, the piece offers a yardstick — the gap between 10-year sovereign yields — for judging how far euro-zone bond markets sit from conditions that have drawn policymakers' attention before.
Forward guidance is not dead
Chief Global Economist Jennifer McKeown takes on the narrative of the "death of forward guidance" in Forward guidance is not dead: here's what it tells us. For all that talk, she writes, central banks are still providing a clear steer of how policy will respond under given... For readers of this week's meetings, the implication is that the accompanying statements deserve as much attention as the rate decisions themselves.
Related coverage
Alongside the podcast, Capital Economics is hosting an event titled Central Bank Drop: Unpacking Fed and ECB October Meetings and has published a separate UK fiscal preview, UK Budget 2026 Preview: Unfinished Fiscal Business. The event is built around unpacking the two October central bank meetings, while the UK preview, titled "Un Fiscal Business," addresses the fiscal questions outstanding ahead of the Budget.
Capital Economics is an independent economic research consultancy. The Federal Reserve sets US monetary policy, the ECB sets policy for the euro zone, and the UK Budget — presented by the Chancellor of the Exchequer — sets the government's tax and spending plans, making the three fixtures among the most closely watched events on the global economic calendar.
